UK Crypto Firms Face Fresh FCA Authorization Process

The UK Financial Conduct Authority (FCA) has issued final guidance requiring crypto firms to reassess their permissions before applications open on September 30 for a regulatory regime taking effect in October 2027. The FCA's guidance defines which crypto firms need approval, and activities within the guidance include issuing qualifying stablecoins, running crypto trading platforms, dealing in digital assets, and arranging transactions. Companies may also need to request a variation of permission if they plan to conduct one or more regulated crypto activities.

The existing FCA registrations will not automatically become authorizations under the new rules. Companies registered under the UK's anti-money laundering rules must also complete the new authorization process. The FCA has finalized much of its rule package in June after several rounds of industry consultation, covering market entry, stablecoin reserves and redemptions, crypto custody, operational resilience, consumer treatment, and capital requirements.

The regulator plans to consult on targeted updates involving qualifying UK stablecoins, proprietary trading, market making, and some technology providers. Overseas firms may fall inside the UK crypto perimeter if they provide regulated services to customers in the country or operate within the UK market. The FCA's June policy package identifies overseas businesses serving UK consumers among the firms affected by the regime.