The United Kingdom’s Financial Conduct Authority (FCA) has opened a series of consultations on proposed rules for digital asset markets, advancing the government’s efforts to create a comprehensive regulatory framework for crypto.
Published across three consultation papers, the proposals cover crypto trading platforms, intermediaries, staking, lending and borrowing, market abuse, disclosures, and decentralized finance (DeFi). Responses to the consultation are open until February 12, 2026.
The FCA said the proposals aim to foster innovation while ensuring consumers understand the risks of crypto investment. “Regulation should not eliminate risks entirely but ensure participants operate responsibly and transparently,” the watchdog noted.
“Our goal is to have a regime that protects consumers, supports innovation, and promotes trust,” said David Geale, FCA executive director for payments and digital finance, emphasizing that industry feedback will shape the final rules.
From advertisements to market structure
The consultations mark a shift in the UK’s approach, moving beyond earlier requirements focused on financial promotions and Anti-Money Laundering compliance toward full “market structure” rules for crypto.
Under the proposals, exchanges would face clearer standards on admissions, disclosures, and trading integrity. Measures to prevent insider trading and market manipulation would align crypto markets more closely with traditional finance.
The consultation also seeks input on crypto staking services, specifically how firms should disclose risks when offering yield-bearing products that lock customer assets. Lending and borrowing activities are included as well, with proposed safeguards designed to protect both borrowers and lenders.
Another key focus is decentralized finance (DeFi). The FCA is consulting on whether DeFi activities — including trading, lending, and borrowing without intermediaries — should be subject to the same regulatory expectations as traditional financial services.
Geale reminded the public that crypto remains largely unregulated at present. “While we work closely with partners to deliver the UK’s crypto rules, people should remember crypto is largely unregulated — except for financial promotions and financial crime purposes,” he said.
UK aims to extend finance laws to crypto
The consultation follows a UK government announcement that it plans to introduce legislation by October 2027 to bring crypto companies under existing financial laws, placing them under FCA oversight.
UK Chancellor Rachel Reeves described the move as a “crucial step” in securing the country’s position as a global financial center in the digital age.
