UK Crypto Lending and Borrowing: FCA Clarifies Regulatory Framework

The UK's Financial Conduct Authority (FCA) has clarified its stance on crypto lending and borrowing under the incoming regulatory framework. The FCA says that neither activity will become a standalone regulated service, but rather may trigger other permissions depending on how transactions are structured.

Firms conducting lending or borrowing activities must secure the relevant FCA permissions before the full regime begins in 2027. Authorization applications opened on September 30, with the new framework taking effect on October 25, 2027.

The FCA's guidance states that transferring cryptoassets in return for value may count as buying or selling under the rules, and dealing requirements may also catch yield paid in qualifying crypto assets.