FCA’s cryptoasset authorisation gateway is now open

Introduction

On 30 September 2026, the Financial Conduct Authority’s (FCA) authorisation gateway opened for firms that intend to undertake any of the new cryptoasset regulated activities in the UK. The FCA published the final rules and guidance for the new cryptoasset regulatory regime on 30 June 2026. This follows the passage of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 in February (the Regulations). The Regulations bring a range of cryptoasset activities into the UK regulatory perimeter for the first time. The specific activities are discussed in detail further below. The new regulatory regime for cryptoassets comes into force on 25 October 2027. Firms planning to carry on cryptoasset regulated activities on that date must use the FCA’s authorisation gateway to avoid disruption to their businesses. 

The authorisation gateway includes important transitional and saving arrangements for those firms currently providing cryptoasset services, such as exchange and custodian wallet providers registered under the Money Laundering, Terrorist Financing, and Transfer of Funds (Information on the Payer) Regulations 2027 (MLRs) and firms that are authorised or registered under the Payment Services Regulations 20217 or the Electronic Money Regulations 2011. Firms that are already authorised to carry on regulated activities under the Financial Services and Markets Act 2000 (FSMA) in relation to “traditional” investment types will need to apply for a variation of permission to the extent they want to add cryptoassets to their current permissions.

Key dates

Part 7 of the Regulations grants the FCA power to set a period prior to the commencement of the new cryptoasset regime during which firms can submit applications for authorisation or variations of permission. Pursuant to this power, the FCA has published a direction providing that the application window opens on 30 September 2026 and closes on 28 February 2027 (the Application Period). 

Applications submitted during the Application Period

The FCA expects to determine all applications submitted to it during the Application Period prior to 25 October 2027. However, if an application has not been determined by that date, the Regulations include a saving provision that allows a firm (e.g., a cryptoasset exchange provider currently registered under the MLRs) to continue to provide cryptoasset services until its application has been determined. The Regulations permit the FCA in certain circumstances to direct a firm operating under the saving provision to instead enter the transitional provision. In the case of an application that is refused, the firm will enter the transitional provision so that it may exit the UK market in an orderly manner.   

Applications submitted outside the Application Period  

Firms are permitted to submit applications for authorisation or variations of permission outside of the Application Period, but there are potentially significant implications for doing so. First, the FCA will not expedite the assessment of such applications, meaning that authorisation (or variation of permission) may not be granted before the new regime goes live. Those firms that apply outside of the Application Period which have not been authorised before 25 October 2027 will enter the transitional provision until their application has been determined. While in the transitional provision, such firms will only be able to undertake the new cryptoasset regulated activities to the extent it is necessary for the performance of an existing contract (i.e., a contract entered into before the firm entered the transitional provision). These firms will not be permitted to enter into new contracts with existing or new customers.  

Firms that do not apply 

Firms that do not apply for authorisation or variation of permission are required to run off their UK cryptoasset business before 25 October 2027. These firms will not have access to the saving or transitional provisions. Firms that fail to run off their business before the new cryptoasset regime commences risk breaching the prohibition in section 19 FSMA on carrying on regulated activities without authorisation, which is a criminal offence.

New cryptoasset regulated activities

As noted above, section 19 FSMA provides that no person may carry on a regulated activity, by way of business, in the UK unless that person is authorised or exempt. This is referred to as the “general prohibition”. Section 22 of the FSMA defines a regulated activity as an “activity of a specified kind” which “relates to an investment of a specified kind” or “is carried on in relation to property of any kind”. For this purpose, “specified” means specified by HM Treasury by statutory instrument. The relevant statutory instrument is the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (the RAO). The RAO identifies a range of specified activities, including dealing in investments as principal or as agent, advising on investments and managing investments. Specified investments comprise, among other things, shares, bonds and other debt instruments, options and futures, contracts for differences and units in a collective investment scheme.

The Regulations amend the RAO by creating the following new regulated activities:

• Issuing a qualifying stablecoin – includes offering and redeeming the stablecoin as well as holding (or arranging for another to hold) fiat currency or other assets to maintain the value of the stablecoin;
• Safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets – means safeguarding (i.e., having control of the cryptoasset through any means that would enable the firm to bring about the transfer of the benefit of the cryptoasset to another person) a qualifying cryptoasset or a specified investment cryptoasset on behalf of another person and arranging for another person to safeguard cryptoassets;
• Operating a qualifying cryptoasset trading platform – meaning a system that brings together multiple buying and selling interests in qualifying cryptoassets and results in contracts for the exchange of those cryptoassets for money (including e-money) or other qualifying cryptoassets;
• Dealing in qualifying cryptoassets as principal – defined as buying, selling, subscribing for or underwriting qualifying cryptoassets as principal;
• Dealing in qualifying cryptoassets as agent – defined as buying, selling, subscribing for or underwriting qualifying cryptoassets as agent; 
• Arranging deals in qualifying cryptoassets – includes (i) making arrangements for another person, whether as principal or agent, to buy, sell, subscribe for or underwrite a qualifying cryptoasset, and (ii) making arrangements with a view to a person who participates in the arrangements for the buying, selling, subscribing for or underwriting of a qualifying cryptoasset, whether as principal or agent; and
• Qualifying cryptoasset staking – means the use of a qualifying cryptoasset in blockchain validation with the relevant regulated activity capturing making arrangements on behalf of another person, whether as principal or agent, for qualifying cryptoasset staking.

Each of the cryptoasset regulated activities described above is subject to specific and general exclusions set out in the RAO. Some of these exclusions track existing exclusions applicable to traditional specified investments with which firms will be familiar. 

New cryptoasset specified investments

Key to the operation of the new regime is the definition of “cryptoasset” in section 417 FSMA, which is any “cryptographically secured digital representation of value or contractual rights that (i) can be transferred, stored or traded electronically, and (ii) uses technology supporting the recording or storage of data (which may include distributed ledger technology)”.

The Regulations amend the RAO by introducing the following three types of cryptoassets to the list of specified investments:

• “qualifying cryptoassets” which means a cryptoasset that is fungible and transferrable. The definition excludes (i) electronic money; (ii) fiat currency; (iii) central bank digital currency; and (iv) cryptoassets that cannot be transferred or sold in exchange for money or other cryptoassets except by way of redemption with the issuer and can only be used to acquire goods or services from the issuer or to acquire goods or services within a limited network of service providers which have direct commercial agreements with the issuer;
• “qualifying stablecoins” which is defined as a type of qualifying cryptoasset that seeks or purports to maintain a stable value in relation to a particular fiat currency and fiat currency or other assets are held in order to maintain a stable value; and 
• “specified investment cryptoassets” which is a type of qualifying cryptoasset that is also a specified investment, like tokenized shares. Certain activities in relation to specified investment cryptoassets were already within the regulatory perimeter.

Territorial scope

All firms, and particularly those that provide cryptoasset services from overseas to UK customers, should carefully review the territorial scope of the new UK cryptoasset regime. There are important differences in the treatment of overseas firms undertaking cryptoasset activities compared to regulated activities in relation to traditional specified investments, most notably that the former will not be able to rely on the overseas persons exclusion in Article 72 of the ROA (although the overseas persons exclusion may be available for regulated activities carried out in relation to specified investment cryptoassets). 

The Regulations amend the provisions of FSMA that address when a person is deemed to be carrying on a regulated activity in the UK to specifically address the new cryptoasset regulated activities. The amendments provide that, where a person is dealing in qualifying cryptoassets as principal or agent, arranging deals in qualifying cryptoassets or operating a qualifying cryptoasset trading platform outside the UK, that person will be regarded as carrying on the relevant activity in the UK where they are involved in the sale or subscription of a qualifying cryptoasset to or by a consumer in the UK. In these circumstances, the overseas firm would need to become FCA authorised or cease dealing with UK consumers. 

A consumer means a person in the UK who is acting for a purpose other than for any trade, business or professional. However, the overseas firm will not be deemed to be carrying on activities in the UK if there is a person interposed between the overseas firm and the UK consumer who is authorised to carry on the regulated activity of dealing in qualifying cryptoassets as principal or operating a qualifying cryptoasset trading platform. Note that the overseas firm does not benefit from having a person interposed that is authorised to deal as agent or make arrangements.

An overseas firm is not required to become FCA authorised if it carries on any of these activities with a UK institutional client, provided the UK institutional client is not acting as an intermediary between the overseas firm and a UK consumer. However, when an institutional client is acting as an intermediary, the non-UK firm will not be deemed to be carrying on a regulated activity in the UK as long as the intermediary trades on a UK qualifying cryptoasset trading platform or in a principal capacity. 

In relation to issuing a qualifying stablecoin, the activity is considered to be carried on in the UK where all the elements of the activity are carried on from, or arranged to be carried on from, an establishment in the UK. That means a person outside the UK will be deemed to be carrying on the activity of issuing a qualifying stablecoin where the offering, redemption and maintaining value elements are being carried on in the UK on their behalf.  

Overseas firms should carefully consider the impact of the amended section 418 FSMA on their specific cryptoasset activities to determine whether they could be deemed to take place in the UK, thereby triggering a need to obtain FCA authorisation or to rely on an exemption (if available). 

Additional information 

Additional information on the new regulatory regime for cryptoassets and the authorisation process can be found on the FCA’s website.