The European Commission has launched consultations on the review of the Markets in Crypto Assets Regulation (MiCAR). The framework, implemented in 2024, establishes a harmonised regime covering crypto assets, including asset referenced tokens and e money tokens, as well as their issuers and crypto asset service providers. The consultation involves: (i) a public consultation on general views in relation to the different types of digital assets and the associated services industry used by individual retail users; and (ii) a targeted consultation covering more technical and legal questions for stakeholders on whether MiCAR remains fit for purpose in light of evolving market and international developments. Of particular interest in the targeted consultation is the section on topics beyond the initial scope of MiCAR, which covers questions on decentralised finance and prediction markets and perpetual futures.

Feedback will inform the EC's report on the application of MiCAR and the latest developments in markets crypto-assets, mandated by Articles 140 and 142 of the Regulation. The report may, if needed, be accompanied by a new legislative proposal to amend and complement this regulation. The deadline for feedback on both consultations is 31 August.

The UK Financial Services Regulatory Initiatives Forum has published the tenth edition of the Regulatory Initiatives Grid, setting out the ongoing and upcoming initiatives impacting the UK financial services sector. The Grid provides an overview of the current state of play as opposed to launching new initiatives, and is also used to communicate timing updates on deliverables where relevant. The grid includes a multi-sector section which covers cross-cutting and omnibus topics such as sustainable finance and operational and financial resilience. There are further sector specific sections including in relation to: banking, credit and lending; payment services and cryptoassets; investment management; retail investment; and wholesale financial markets.

The grid includes a number of UK developments in relation to other items in this week's update, including those mentioned in the King's speech, and the prospective changes in the Financial Services and Markets Bill. Further information is detailed in those specific items covered this week. Separate press releases announcing the Grid have also been published by the UK Financial Conduct Authority and the Bank of England.

Readers are also invited to provide feedback on the Grid and its usefulness in enabling planning for regulatory initiatives and any suggested improvements.

The UK Prudential Regulation Authority (PRA) has issued a Dear CEO letter on innovations involving deposit-takers, e-money and regulated stablecoins. The letter supersedes the 2023 letter and provides clarification in light of recent developments including the UK cryptoassets regulatory framework. It should be read alongside the PRA's Dear CEO letter on the prudential treatment of banks' cryptoasset exposures.

The PRA's core expectations remain unchanged but the letter clarifies how firms should manage risks arising from innovation, especially as regards retail customers. In particular, the letter confirms that while deposit-takers may innovate within deposit structures (including tokenised deposits), any issuance of e-money or stablecoins within groups should take place through separate, non-deposit-taking and insolvency-remote entities, with clearly distinct branding and presentation. This should be supported by disclosures, warnings, on-boarding, and customer education, but should not be relied upon as the sole means of mitigating the risk of confusion.

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The UK Prudential Regulation Authority (PRA) has issued a Dear CEO letter setting out updated expectations on the prudential treatment of tokenised assets, stablecoins and other cryptoasset exposures. This replaces the 2022 guidance which set out interim expectations when cryptoasset markets were less developed and international standards were still under development.

The PRA reaffirms that firms should apply the full prudential framework to cryptoasset exposures, including the Fundamental Rules, Pillar 1 and Pillar 2 requirements, and the Internal Capital Adequacy Assessment Process. It emphasises the need to maintain strong governance and risk management, including by carefully assessing whether the characteristics of these assets are sufficiently captured within existing frameworks.

It confirms that a conservative capital treatment remains appropriate for most cryptoassets, including a 100% capital requirement for unbacked cryptoassets, while recognising that certain newer forms of cryptoassets may warrant a more risk-sensitive approach. The PRA also clarifies that tokenised traditional assets should generally receive the same prudential treatment as their non-tokenised equivalents where legal rights and underlying risks are comparable, in line with a "same risk, same regulatory outcome" principle.

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The UK Financial Conduct Authority (FCA) and Bank of England (BoE) have published a joint call for input on the development of tokenisation in UK wholesale financial markets. Tokenisation – being the representation and ownership of assets using distributed ledger technology (DLT) – has the potential to transform how assets are issued, traded and settled. The paper seeks feedback on how existing rules and market infrastructure may support or constrain the adoption of tokenisation and includes the following content.

• A potential framework to consider the future use of tokenisation in wholesale markets, covering both the long-term end state and the transition towards it.
• Identification of the key infrastructure, policy and regulatory principles and operational considerations proposed to feature in future policy and regulation.
• Proposals on the regulatory regime for issuing and exchanging digital assets, prudential and collateral treatment, and central bank money settlement of digital asset transactions.
• An initial roadmap of initiatives that will support market evolution, to help industry engagement.

The deadline for responses is 3 July. A feedback statement is due in summer, with a final cross-authority roadmap for the digitalisation of wholesale markets to follow later in the year.

The King's speech was delivered to Parliament, setting out a number of legislative measures relevant to financial services and the wider economic regulatory framework. The speech is accompanied by briefing notes, which outline the legislation to be brought forward. In the context of financial services, one of the bills announced is the Enhancing Financial Services Bill.

Key measures under this include:

• Reforming the UK Financial Ombudsman Service, as confirmed by HM Treasury (HMT) in its March consultation response to modernise the financial redress system.
• Abolition of the UK Payment Systems Regulator and integration into the UK Financial Conduct Authority (FCA), as confirmed by HMT in its April consultation response.
• Reducing administrative burden in the Senior Managers and Certification Regime, as confirmed by HMT in its April consultation response.
• Enabling credit unions to expand, as confirmed by HMT in its March call for evidence response on reforms to the credit union framework.

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The European Securities and Markets Authority (ESMA) has published a compliance table under the Markets in Cryptoassets Regulation (MiCAR) setting out member state compliance with its guidelines on when a third-country firm is deemed to solicit clients established or situated in the EU, and the supervision practices to detect and prevent circumvention of the reverse solicitation exemption under MiCAR. This follows an earlier compliance table published on 5 May, setting out member state compliance with ESMA's guidelines on procedures and policies (including client rights) in the context of cryptoasset transfer services under MiCAR on investor protection.

The UK Financial Conduct Authority (FCA) has announced that from 11 May, cryptoasset firms preparing for the new UK cryptoasset regime will be able to request pre‑application meetings through the FCA's pre‑application support service (PASS). The meetings are free of charge and are intended to allow firms to discuss proposed business models and regulatory expectations with the FCA and to raise questions ahead of applying for authorisation or a variation of permission. Meetings will take place from July, before the authorisation gateway opens on 30 September. The new cryptoasset regulatory regime scheduled to commence on 25 October 2027. For further background on the regime, you may wish to watch our webinars which are available here.

HM Treasury (HMT) has published the draft Financial Services and Markets Act 2000 (Cryptoassets) (Amendment) Regulations 2026 and a policy note proposing targeted changes to the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026. The draft statutory instrument (SI) seeks to address unintended consequences of the cryptoasset regime and support the interim use of UK‑issued qualifying stablecoins (UKQS) for payments ahead of wider payments services reforms announced in a related press release. The reforms are expected to bring UKQS payment services into the regulated payments perimeter.

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The UK Financial Conduct Authority (FCA) has published a speech by Jessica Rusu, chief data, information and intelligence officer, setting out how the FCA intends to support fintech firms in the next phase of innovation amid rapid advances in AI and the emergence of "agentic commerce".

The FCA highlighted its principles-led, outcomes focused approach to AI regulation and announced the next phase of its AI Lab, including: (i) an extended partnership with NVIDIA and NayaOne; (ii) a second cohort of firms entering AI Live Testing, which will conclude by the end of the year, with an evaluation report expected in Q1 2027; (iii) the scaling of the Supercharged Sandbox, giving more UK fintechs access to data and Nvidia compute to build their products, with a second intake opening on 5 May; and (iv) confirmation that the FCA will not introduce new AI specific rules at this stage, but will instead publish examples of good and poor practice later in the year. In parallel, the FCA emphasised the role of its recently published open finance roadmap and announced that its Scale Up Unit is now open for expressions of interest from solo regulated firms to support them in scaling and entering new markets.

The UK Financial Conduct Authority (FCA) has published its innovation insights 2025 report, setting out key trends in UK fintech innovation, evolving regulatory risks and lessons from firms' engagement with the FCA's innovation services. By sharing insights, the FCA aims to support earlier and clearer regulatory engagement and strengthen evidence-led policy and supervision.

The report notes that while global fintech investment exceeded USD130 billion in 2025, funding has become more selective, concentrating on fewer, more mature firms, with the UK ranking second globally for disclosed investment. It highlights a shift in the key challenge faced by firms, from product development to understanding how regulation applies to them, with demand for FCA support increasing significantly. This includes a 49% rise in applications to the Regulatory Sandbox and Innovation Pathways in 2025, particularly in relation to AI, distributed ledger technology, and open banking and open finance. In the report, the FCA also summarises steps taken in 2025 to expand its innovation services. Looking ahead, the FCA signals a focus in 2026 on clearer guidance, more structured testing pathways, broader engagement with incumbent firms, and supporting UK competitiveness and international growth.

The UK Financial Conduct Authority (FCA) has published consultation paper CP26/13, proposing changes to the Perimeter Guidance Manual (PERG) within the FCA Handbook to clarify the scope of the new regulated cryptoasset activities and when permissions will be required. In addition, the consultation paper aims to provide clarity for firms transitioning from the FCA's current cryptoasset regime (under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017) (MLRs) to the new cryptoasset activities under the Financial Services and Markets Act 2000 (FSMA).

The proposed new chapter in PERG will contain guidance on how to determine whether an activity is within the perimeter, and guidance on the new specified investments and new regulated cryptoasset activities, including which permissions may be required for certain business models and how specific exclusions operate and other related issues. The FCA also clarifies that, as outlined by HM Treasury in the explanatory memorandum accompanying the Cryptoasset Regulations 2026, FSMA authorised cryptoasset firms will not need to register as "cryptoasset exchange providers" or "custodian wallet providers" under the MLRs but instead will only need to notify the FCA. However, these firms will still need to comply with the MLRs. The proposed guidance in full is set out in the draft Perimeter Guidance (Regulated Cryptoasset Activities) Instrument 2026, in Appendix 1 of the consultation paper.

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The UK Financial Conduct Authority (FCA) has published its open finance roadmap, setting out its vision for open finance in the UK from now until 2030. The FCA explains that the roadmap draws on lessons from open banking and international experience and takes a phased evidence-led and collaborative approach.

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The Digital Regulation Cooperation Forum (DRCF) has published an insights paper (dated 26 March) on smart data frameworks, providing an international review and comparative analysis to inform the UK's implementation of cross sector smart data schemes under the Data (Use and Access) Act 2025 (DUAA). The paper notes a global shift away from single sector models, such as open banking, towards economy wide frameworks, while highlighting significant divergence in how jurisdictions have implemented them. The DRCF identifies three main approaches: (i) regulator mandated models, which provide legal certainty and consistent standards, but risk high compliance costs and reduced flexibility; (ii) market facilitated models, which support innovation, but often suffer from uneven adoption and unclear liability; and (iii) public infrastructure led approaches, which support interoperability but require significant upfront investment and sustained political commitment.

The paper outlines potential insights and considerations for the UK as it implements the DUAA, including:

• Establishing a central smart data governance body to coordinate scheme development across sectors, set baseline technical and security standards, ensure interoperability and provide a clear strategic direction.
• Introducing smart data schemes using a phased approach, prioritising sectors with clear consumer benefits and policy alignment (for example, energy and Net Zero), and tailoring implementation models depending on their digital maturity, market structure and regulatory landscape context.

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The UK Financial Conduct Authority (FCA) has published a new webpage for cryptoasset firms who are considering applying for registration under the Money Laundering, Terrorist Financing, and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs), ahead of the new UK crypto regime which is due to come into force on 25 October 2027. The FCA states that the webpage is not relevant to cryptoasset firms that will still need to be registered with the FCA under the MLRs but will not require authorisation under the new Financial Services and Markets Act 2000 (FSMA) crypto regime, as for these firms, the MLR gateway will continue to operate as normal.

The webpage covers:

• The requirement to be registered under the MLRs: Firms who provide in-scope cryptoasset services in the UK are required to be MLR-registered before trading, until the new FSMA regime starts. Once the FSMA regime applies, firms carrying out regulated cryptoasset activities will require FSMA authorisation, including firms already registered under the MLRs. Applications for FSMA authorisation will open on 30 September. Firms may apply for registration at any time before the new regime begins on 25 October 2027. However, they should only do so if they are confident that they can be registered early enough for it to be worthwhile before the new regime starts.

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The draft Money Laundering and Terrorist Financing (Amendment) Regulations 2026 were laid before UK Parliament, alongside a draft explanatory memorandum. The draft Regulations propose amendments to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) to implement the government's consultation response to its 2024 consultation on improving the effectiveness of the MLRs. The amendments aim to strengthen the UK's anti-money laundering and counterterrorist financing (AML/CTF) regime and ensure maintained compliance with Financial Action Task Force standards.

Following feedback to the technical consultation on the draft Regulations in September 2025, the government has made a number of targeted changes, including:

• Pooled client accounts (PCAs): clarifying that banks may continue to apply a simplified, risk-based approach to PCAs where the PCA holder is: (i) subject to the MLRs or equivalent overseas regimes; (ii) the business relationship with the PCA-holder presents a low risk of money laundering and terrorist financing; and (iii) information on the identity of the underlying customers is available on request to the PCA-holder. Additional clarifications are also made.

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The UK Financial Conduct Authority (FCA) has published its regulatory priorities report for the payments sector. These reports replace the FCA's previous portfolio letters and will now be published annually for each industry sector. The report is directed at firms authorised or registered under the Payment Services Regulations 2017 and the Electronic Money Regulations 2011. In the report, the FCA sets out four key priority areas for the next 12 months:

• Preparing for the future to support effective competition, innovation and growth: The FCA will continue policy work on open banking, stablecoins, and modernising payments regulation. It will support industry in establishing a Future Entity for open banking. It will also support HM Treasury (HMT) in introducing legislation to grant the FCA powers to set new rules for the long-term open banking regulatory framework. The FCA will work with HMT to future-proof payments regulation, including consideration of whether changes to or the development of regulation is needed to support agentic AI payments. It will also work with the sector to consider how stablecoins and other tokenised payment instruments can be brought into regulated payments.

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The UK Financial Conduct Authority (FCA) has published its regulatory priorities report for the retail banking sector. These reports replace the FCA's previous portfolio letters and aim to provide a clearer and more consistent articulation of regulatory expectations.

In the report, the FCA notes that retail banking is undergoing significant change as customers use branches less and rely more on digital channels. Business models are also diversifying, with increased fintech activity and the continued development of open banking and new payment types.

The FCA sets out four priority areas for the next 12 months:

• Access to cash and essential banking services: As firms pursue digital first transformations, the FCA emphasises that firms must ensure these do not create foreseeable harm, particularly for customers with lower digital capability. Alternative services must be in place before any branch closures. The FCA will continue to monitor firms' approaches under its branch closures or conversions guidance and the consumer duty and will intervene where necessary.
• Good outcomes from products and services: Firms are expected to continue improving the data they use to monitor customer outcomes so they can identify where further action is needed. The FCA will take targeted action where it identifies poor outcomes, including poor value or issues affecting vulnerable customers.

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The UK Home Office has published its updated fraud strategy for 2026–29, setting out the government's new approach to tackling fraud. It explains how the UK intends to disrupt the methods used by criminals, strengthen protections for the public and businesses, and improve how victims are supported. The strategy is split into three pillars:

• Disrupt: cutting off the tools, technologies and platforms used by criminals, including launching the Online Crime Centre (a new capability that will bring together law enforcement, intelligence agencies and industry expertise to identify and dismantle fraud networks) and strengthening international partnerships. Amongst the initiatives seeking to prevent the abuse of the UK's financial flows, the Home Office will launch a call for evidence focused on unauthorised fraud, the UK Financial Conduct Authority (FCA) will consider examples of practices for preventing APP fraud and money mule activity and will share its recommendations, and HM Treasury will repeal the existing Strong Customer Authentication technical standards, allowing the FCA to incorporate key standards into its rules and adopt a more agile, outcomes-focused approach. Regulating cryptoasset financial services activities is also seen as a crucial step. The government intends to develop metrics for measuring the prevalence of fraudulent activity in financial services, and their performance in removing and/or blocking such activity.

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The UK Financial Conduct Authority (FCA) has published its quarterly consultation paper No. 51, inviting feedback on proposed amendments to its Handbook. Significantly, it included a proposal to increase the clearing threshold for commodity derivatives under the UK version of the European Market Infrastructure Regulation (UK EMIR) to EUR5 billion, to ensure the threshold remains appropriate in light of higher commodity prices.

Other changes include:

• Consequential changes to the client assets sourcebook to ensure its effective application to regulated cryptoasset activities.
• Rehousing some provisions in Article 17 of the UK version of Commission Delegated Regulation (EU) 2017/587 (RTS 1) into the framework now provided by MAR 11A and tidying up provisions relating to private rights of action.
• Making targeted changes to the collective investment scheme sourcebook to reflect amendments in the 2025 Statement of Recommended Practice for authorised funds.

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The Financial Action Task Force (FATF) has issued a targeted report setting out the money laundering (ML), terrorist financing (TF) and proliferation financing (PF) risks and vulnerabilities related to stablecoins and unhosted wallets, particularly during peer-to-peer (P2P) transactions. In addition, the report identifies and shares a range of good practices that could be implemented by jurisdictions and the private sector to mitigate these risks and makes recommendations for implementation.

The report highlights that only a limited number of jurisdictions have implemented targeted regulatory frameworks for entities operating within the stablecoins ecosystem, explicitly taking into account the features that distinguish stablecoins from other virtual assets. While the FATF Standards do not require jurisdictions to adopt regulatory frameworks for stablecoin arrangements beyond those already applicable to virtual asset service providers, the FATF urges countries to recognise the specific ML/TF/PF risks associated with stablecoins and to implement proportionate and effective mitigating measures that reflect their distinct characteristics.

FATF recommends that jurisdictions should apply Recommendation 15 to all relevant entities involved in stablecoin arrangements, ensuring that they are subject to clear, enforceable ML/TF obligations. Jurisdictions should also define the roles and responsibilities of all participants throughout the stablecoin ecosystem and impose appropriate ML/TF obligations using a risk-based approach.

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The UK Financial Conduct Authority (FCA) has published a new webpage with information for cryptoasset firms that are currently using the services of an FCA-authorised firm to approve their cryptoasset financial promotions. Cryptoasset firms that are not authorised under the Financial Services and Markets Act 2000 (FSMA) or registered with the FCA under The Money Laundering, Terrorist Financing, and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs) (including overseas firms) may use FCA-authorised firms to approve their cryptoasset financial promotions (referred to as an s.21 approver) for communication to UK consumers. The webpage sets out information on the use of s.21 approvers ahead of the UK's new crypto regime coming into force on 25 October 2027:

• Cryptoasset firms that apply for authorisation during the application period—Cryptoasset firms using an s.21 approver and applying for authorisation (or variation) during the application period, which runs from 30 September to 28 February 2027, may continue to use their existing s.21 approver until their application is determined (including during any period in the saving provision).
• Cryptoasset firms that do not apply for authorisation during the application period—Cryptoasset firms using an s.21 approver that do not apply during the application period may continue to use their existing s.21 approver until the new cryptoasset regime comes into force. From this date, if the firm's application has not been determined, it will enter the transitional provision and only be allowed to communicate promotions to pre-existing contracts. These promotions will not require an s.21 approver.

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The UK Payments Vision Delivery Committee (PVDC) has published the payments forward plan, outlining key initiatives expected across retail and wholesale payments and aspects of digital assets in the next three years. The plan sets out the actions required to deliver the government's National Payments Vision and support the continued growth of the sector. It focuses on initiatives led by HM Treasury, the Bank of England, the Financial Conduct Authority and the Payment Systems Regulator, while reflecting wider UK government and public sector activity where relevant, and certain private sector-led workstreams that flow from public authority steers.

Several initiatives are also said to have implications beyond payments. In particular, the FCA will continue to explore potential interoperability between open banking and other smart data schemes, reflecting the government's intention for the open banking framework to form the basis for open finance. The PVDC states that while the plan captures a wide range of initiatives which are relevant to payments and seeks to provide clarity on key milestones, it is not exhaustive and timings remain subject to change. The Committee also confirms that an enhanced focus on payments will be added to the Regulatory Initiatives Grid in 2027.

The European Securities and Markets Authority (ESMA) has issued a statement reminding firms of their obligations under existing national product intervention measures on contracts for differences (CFDs). The statement is in light of the growing offering of derivatives marketed as "perpetual futures" or "perpetual contracts", including those providing leveraged exposure to cryptoassets such as Bitcoin.

ESMA emphasises that where such products meet the definition of a CFD, they are likely to fall within the scope of existing intervention measures adopted by national competent authorities and must therefore comply with applicable product intervention requirements. This includes leverage limits, mandatory risk warnings, margin close-out rules, negative balance protection and the prohibition on monetary and non-monetary incentives. The statement further reminds firms that derivatives require a narrowly defined target market and an aligned distribution strategy. Firms should be carrying out appropriateness assessments in accordance with the relevant requirements for complex financial instruments when providing non advised services, and must identify, prevent and manage any conflicts of interest arising from the offering of these products. While the public statement specifically refers to derivatives marketed as perpetual futures or perpetual contracts, ESMA states that firms should assess whether national product intervention measures apply to all derivatives offered, irrespective of their commercial name.

The European Parliament's Committee on Economic and Monetary Affairs (ECON) has published a draft report (dated 19 February) on digital assets and challenges for the competitiveness and integrity of the EU's financial system. The report explores the impact of the emergence of digital assets on the financial services sector and what that means for the regulatory framework. It discusses several ongoing risks in the digital assets sector, including, from a macro prudential standpoint, the need to strengthen data capabilities to better assess financial risks and the interconnectedness of digital assets with the broader financial system. The report also notes the role cryptoassets play in circumventing anti money laundering/countering the financing of terrorism requirements and sanctions.

It includes a motion for a European Parliament resolution which, amongst other things, calls on the various European authorities to strengthen the supervisory dialogue on significant multi-function groups (MFGs) and underlines the need to align the MiCAR policy framework for significant non-bank MFGs. It calls on the European Commission to come forward with a legislative proposal urgently to provide legal certainty on stablecoin multi issuance, and to provide strong prudential safeguards, robust cooperation arrangements, and enhanced crisis management protocols. It also stresses that interoperability is crucial in digital finance, and that legal entity identifier/verifiable legal entity identifier-type approaches should be assessed as infrastructure-grade tools. The EU's dependence on non-EU service providers for DLT infrastructure is also flagged as a matter of 'regret'.

The UK Financial Conduct Authority (FCA) has published a new webpage with guidance aimed at improving the quality of applications for authorisation and registration by payments firms and digital asset firms. The FCA outlines its regulatory expectations through a series of video guides covering common deficiencies and best practices. For both payments firms and digital asset firms, the videos cover the role of a Money Laundering Reporting Officer (MLRO), highlighting common anti‑money laundering compliance gaps and fitness and propriety standards, and the application process for authorisation. Other video guides are directed specifically at payment firms, focusing on how firms (including e-money firms) can prevent financial crime through business‑wide risk assessments, senior management responsibilities and controls against authorised push payment fraud, as well as on demonstrating an effective governance structure as part of an application for authorisation.

The European Banking Authority (EBA) has issued an opinion advising national competent authorities (NCAs) on how to proceed when the transition period (under its no-action letter of 2 June 2025) ends on 2 March. This transition period currently allows cryptoasset service providers (CASPs) to continue providing services involving electronic money tokens (EMTs) that qualify as payment services while submitting, and awaiting the response to, their application for authorisation under PSD2.

The opinion:

• Outlines the conditions under which NCAs are advised to allow CASPs to continue providing EMTs that qualify as a payment service after 2 March, while they do not (yet) hold a license under PSD2.
• Advises NCAs to require CASPs that do not meet all of these conditions to discontinue the provision of such EMT services.
• Advises NCAs to cooperate with the relevant NCA under MiCAR and/or other national enforcement authorities to ensure compliance.

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The International Organization of Securities Commissions (IOSCO) has published its 2026 work programme , setting out its five strategic priorities for the year:

• Strengthening financial resilience and market effectiveness – new key initiatives in this field for 2026 include: (i) addressing over-the-counter derivatives reporting fragmentation; (ii) working on the impact of market microstructures on liquidity and of extended trading hours on equity trading venues; (iii) contributing to the Financial Stability Board's (FSB) work on issues of non-bank data availability, use and quality; and (iv) contributing, as necessary, to follow-up work on the issue of leverage in non-bank financial intermediation (NBFI). IOSCO will also continue to develop work to strengthen the operational resilience of financial market infrastructures (FMIs).
• Enhancing investor protection – IOSCO will launch a new TechSprint in partnership with the UK Financial Conduct Authority's AI Lab and will explore products such as cryptoasset funds, private credit vehicles and retail-facing derivatives. IOSCO will also continue to engage with platform providers to advocate for restrictions on harmful or fraudulent content and to promote the use of its I-SCAN tool (its Enhanced Investor Alerts Portal).
• The evolution of public and private markets – key initiatives in this field include assessing the growing interconnectedness between private equity activities and the audit sector, contributing to the FSB's deep dive on private credit and researching the functioning of public equity markets.

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The Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 have been made and published with an accompanying explanatory memorandum. The statutory instrument (SI) introduces a comprehensive UK regulatory framework for cryptoassets under the Financial Services and Markets Act 2000 (FSMA). This follows the draft version laid before Parliament in December 2025, which we covered previously here. The transitional and savings provisions in the SI enable the FCA to specify a relevant application period and provide for the treatment of, and obligations on, those that do or do not secure all relevant authorisations within that period. This applies to firms seeking authorisation for the first time, FSMA- authorised firms needing to vary permissions, payments and e-money firms, firms that may be accessing the market through section 21 approvers, and firms which are FCA-registered for the purposes of the money laundering regime. The FCA confirmed through its updated webpage that this will be open from 30 September 2026 until 28 February 2027. The provisions enabling the FCA to make or approve rules, guidance, directions etc., in relation to the new regime come into force on 26 February. The go-live date for the new regime is 25 October 2027.

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The European Banking Authority (EBA) has published its draft single programming document (SPD) for 2027–2029, outlining its strategic priorities and resource needs over the three‑year period. The EBA confirms it will focus on implementing new mandates for banking and payments including its oversight role under the Digital Operational Resilience Act, supervision of significant issuers of asset referenced and e money tokens under the Markets in Crypto-Assets Regulation and validation of initial margin models under the amended European Market Infrastructure Regulation (EMIR 3). The EBA will also focus on addressing emerging risks arising from geopolitical instability. This will require new approaches to risk assessment, financial stability monitoring and consumer protection. Supporting EU co legislators also remains central for the EBA as the SPD reflects the priorities for the financial sector and aims to keep the financial system strong while also ensuring it can fund the European economy.

Against this backdrop, the EBA identifies three strategic priorities for 2027–2029: (i) evolving and simplifying the Single Rulebook for banking and financial services; (ii) carrying out risk assessments to support effective risk analysis, supervision and oversight; and (iii) embracing innovation to enhance technological capacity across the sector. The EBA notes that close cooperation with relevant EU and third-country authorities will be required to meet its objectives.

The House of Lords (Financial Services Regulation Committee) has announced the launch of an inquiry into the growth and proposed regulation of stablecoins in the UK. The Committee will examine the development of global and UK stablecoin markets (and its comparison to US and EU markets), expected future growth of sterling‑denominated stablecoins and the opportunities and risks posed to the UK economy, financial services sector, retail consumers and monetary policy. It will also consider the implications of the Bank of England and UK Financial Conduct Authority's proposed regulatory regimes for systemic and non‑systemic stablecoins and whether they are measured and proportionate. A call for evidence, including six questions for written submissions, accompanies the press release. The deadline for responses is 23:59 on 11 March.

The UK Financial Conduct Authority (FCA) has published two separate updated webpages:

• The first updated webpage confirms an extension to the application deadline for those wishing to participate in the stablecoin sprint on 4-5 March and the trade payments roundtable on 15 May. Applications must now be submitted by midnight on 8 February. The FCA will continue to notify applicants of the outcome by 13 February.
• The second updated webpage confirms that the application period for firms wishing to undertake the new cryptoasset regulated activities will be open from 30 September until 28 February 2027.

The European Securities and Markets Authority (ESMA) has published official translations of its final guidelines under the Markets in Crypto-Assets Regulation (MiCAR) specifying the criteria for assessing the knowledge and competence of staff at crypto-asset service providers (CASPs). The guidelines, first published in July 2025, aim to promote greater convergence in the criteria for assessing the knowledge and competence of staff providing advice or information about crypto-assets or related services and their application. It offers key guidance to help CASPs meet their duty to act in their clients' best interests and to support competent authorities in assessing compliance. The guidelines will apply from 28 July. Competent authorities must notify ESMA by 28 March whether they comply or intend to comply with guidelines or, where relevant, provide ESMA with their reasons for non-compliance. CASPs are not required to report on whether they comply.

The UK Office of Financial Sanctions Implementation (OFSI) has published a blog confirming that it is working closely with UK law enforcement and regulatory partners to combat the abuse of cryptoassets and associated money laundering activities. OFSI has joined forces with the Crypto Cash Fusion Cell (CCFC), a pilot, multi-agency initiative bringing together the UK National Crime Agency, the Metropolitan Police Service, His Majesty's Revenue and Customs, the UK Financial Conduct Authority, City of London Police and OFSI, to target criminal funds linked to sanctions offences.

Through this collaboration, OFSI shared detailed intelligence with the CCFC to enable joint working against specific, prioritised targets. This led to action against potential breaches of financial sanctions involving cryptoassets by UK-based individuals. OFSI wants the sector to know that the use of cryptoassets to evade sanctions will be treated no differently to the exploitation of traditional currencies.

The European Commission has issued a call for evidence on its forthcoming action plan to combat online fraud committed through the use of technology (whether online or by telephone). The initiative seeks to build on existing frameworks which already establish comprehensive anti-fraud measures, including the Payment Services Directive, the Instant Payments Regulation and the Digital Services Act. The plan aims to reduce the occurrence and impact of online fraud across the EU by reinforcing coordination, enhancing victim support and improving cross-border and multi-stakeholder cooperation. Its primary objective is to establish a more integrated approach to tackling online fraud. This includes strengthening the EU's 'follow-the-money' approach for detecting, tracing and disrupting fraud proceeds that are channelled through payment accounts, e-money and increasingly, crypto-asset transfers, leveraging EU requirements on supplying accompanying information with transfers of funds and certain crypto-assets. The deadline for feedback is 13 February.

The UK Financial Conduct Authority (FCA) has published a second consultation paper (CP26/4) on the application of the FCA handbook for regulated cryptoasset activities. This follows the earlier consultation published in September 2025 (CP25/5) and HM Treasury's draft statutory instrument intended to bring qualifying cryptoasset activities within the scope of the Regulated Activities Order 2001 and under the FCA's remit. The FCA intends to open its authorisation gateway for crypto permissions in September 2026, with the deadline for comments on this consultation being 12 March.

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The UK Financial Conduct Authority (FCA) and the UK Payment Systems Regulator (PSR) have issued a joint prioritisation statement clarifying their enforcement position on the UK Payments Initiative's (UKPI) centralised "access fee" pricing model being developed for commercial variable recurring payments (cVRP). After consulting the Competition Markets Authority (CMA), the regulators confirm that they will not, at this stage, prioritise investigations under Chapter I of the Competition Act 1998 in relation to specific pricing arrangements concerning UKPI's cVRP scheme.

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The UK Financial Conduct Authority (FCA) has published a letter (dated 19 December 2025) to trade associations outlining next steps towards establishing the Future Entity (FE) that will serve as the UK's long‑term open banking standards‑setting body. The FCA reflects on progress made in 2025, noting industry collaboration on the multilateral agreement for variable recurring payments (VRP), the creation of the transitional multilateral agreement operator and associated governance arrangements, continued development of the VRP commercial model and broader industry preparation for the increased adoption of open banking and VRP services.

Looking ahead, the FCA expects 2026 to be a landmark year, with live transactions flowing through the VRP scheme expected in Q1. It also anticipates that HM Treasury will introduce legislation under the Data (Use and Access) Act 2025 (DUAA) granting the FCA new rulemaking powers for open banking. The FCA plans to consult on new rules for the long‑term regulatory framework enabled by these powers. In parallel, the FCA expects industry to establish a body capable of becoming the FE, which it wants to be the UK's primary standards setting body for application programming interfaces (APIs). Subject to legislation, the FCA expects to use its powers under the DUAA to support this objective.

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The UK Financial Conduct Authority (FCA) has announced the launch of a two-day stablecoin tech-sprint. The sprint, taking place on 4-5 March, will explore the use cases for stablecoins in domestic and international payments, covering retail and wholesale applications. A separate, smaller roundtable will take place on 15 May, focusing on use cases for stablecoins in trade payments, identifying risks, opportunities and where regulation would be beneficial. Follow-up roundtables are expected throughout 2026. Outputs from the sprint are expected to provide actionable insights to directly inform future FCA policy decisions on potential stablecoin payment regulation in the UK. The FCA invites participation from fintechs, payment institutions (including EMIs and acquirers), banks, technology providers, corporates, issuers, consultants and representative groups. A participation pack has been made available with more information on the format of the event and the problem statements the FCA expects to tackle. Applications are due by midnight on 4 February. The FCA will notify applicants by 13 February if they have secured a place at the sprint and/or roundtable.

The Financial Markets Standards Board has published its 2026 workplan. The workplan covers a wide range of areas in relation to wholesale financial markets, and in 2026 the Board sets out the following focus topics:

• In relation to market practices, work is being progressed on pre-hedging, grey market trading, market quotation mechanisms, conduct risks around risk management transactions for new issuances, and price discovery.
• In relation to electronic trading and technology, the relevant committee will be looking at market-facing applications of AI and potentially the application of model risk management frameworks to electronic trading algorithms.

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The Bank of England (BoE) has published a speech by Dave Ramsden, deputy governor, markets and banking, on the evolution of the BoE's approach to resolution. The speech discusses the balance to be struck in optimising ex ante resilience and ex post costs and the response to recent events and the changing environment. Mr Ramsden states that in terms of bank resolution, assuming no unexpected developments, the BoE has now implemented the key policy developments he expects it to – certainly in his remaining term as Deputy Governor, which ends in September 2027. Later this year, the BoE expects to publish an operational guide to the transfer resolution strategies and an update to its operational guide to bail-in. Subject to the findings of the third RAF assessment which begins later this year and market developments, the BoE expects to confirm the timing of the fourth assessment as not being before 2029-30. There is more to do to operationalise the central counterparty (CCP) resolution regime and later this year the BoE expects to consult on resolvability standards for CCPs.

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HM Treasury has published a statement from the G7 Cyber Expert Group (CEG) setting out a high‑level, non‑binding roadmap for a coordinated financial‑sector transition to post‑quantum cryptography (PQC). Building on its previous 2024 statement, the CEG highlights while quantum computing promises significant new capabilities for financial services, these advanced computers will be capable of breaking widely-used cryptographic protocols that protect systems and data. Therefore, the CEG explains how the financial sector should start preparing for this in advance of risks. The roadmap outlines a phased approach for both financial sector entities and public authorities for planning and coordination. It highlights key migration activities including awareness and preparation, discovery and inventory, risk assessment and planning, migration execution, testing and ongoing validation and monitoring. Although not legally binding, the CEG encourages firms to begin planning now. It notes that many jurisdictions currently reference 2035 as an overall target for full migration, with the most important systems ideally upgraded earlier (around 2030–2032). While the trajectory of quantum computing development is uncertain, the statement conveys it may be helpful for organisations to establish comparable migration timelines to ensure their milestones can be achieved prior to the availability of cryptographically relevant quantum computers. The CEG further encourages ongoing monitoring, cross sector information sharing and close coordination with international standard setting bodies to support a harmonised transition to PQC.

The UK Financial Conduct Authority (FCA) has published a new suite of webpages outlining its approach to the upcoming regulatory regime for cryptoasset activities. The regime will be implemented under the Financial Services and Markets Act 2000 (FSMA), through the draft statutory instrument laid before Parliament in December. The regime's go-live date is 25 October 2027.

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The UK Financial Conduct Authority (FCA) has published three consultation papers as the next step in shaping the UK's crypto rules. These consultations complement the final draft statutory instrument (the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025) published by HM Treasury and laid before the UK Parliament on 15 December. The deadline for responses to all three of the consultation papers is 12 February 2026. Final rules and guidance in policy statements are expected in 2026.

The first consultation is CP25/40 on regulating cryptoasset activities, which sets out the FCA's proposed rules and guidance for some of the new cryptoasset activities introduced through the draft statutory instrument and which were not covered previously in CP25/14 and CP25/15. These activities include: (i) operating a trading platform; (ii) intermediaries; (iii) lending and borrowing; (iv) staking; and (v) the approach for decentralised finance.

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The draft Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025 were laid before the UK Parliament, accompanied by an explanatory memorandum. The statutory instrument (SI) introduces a comprehensive UK regulatory framework for cryptoassets under the Financial Services and Markets Act 2000 (FSMA).

Specifically, the legislation amends the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (RAO) to:

• Define the categories of cryptoassets that will be regulated under the regime: "qualifying cryptoassets" which includes "qualifying stablecoins" and "specified investment cryptoassets".
• Specify certain activities related to these categories of cryptoassets as regulated activities, so that any persons carrying on those activities by way of business needs to be authorised for that activity by the UK Financial Conduct Authority (FCA). These new regulated activities include issuing qualifying stablecoin, safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets, operating a qualifying cryptoasset trading platform, dealing in qualifying cryptoassets as principal or agent, or arranging deals in qualifying cryptoassets, and qualifying cryptoasset staking.

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The Financial Services Regulatory Initiatives Forum has published the ninth edition of the Regulatory Initiatives Grid. This sets out the regulatory pipeline for the next two years, outlining 124 live initiatives which is a 13% reduction since the last grid was published. Key priorities include implementing Basel 3.1 standards, advancing the strong and simple prudential framework and reforms to the prospectus regime and wholesale markets review. Innovation-focused measures cover stablecoin regulation, the national payments vision, and development of a UK captive insurance regime, while consumer-focused reforms include the advice guidance boundary review and regulation of buy now pay later products. The Grid also highlights efforts to streamline regulatory processes, with 45 joint initiatives across sectors, and provides indicative timelines for consultations and implementation through 2027. Separate press releases announcing the Grid have also been published by the UK Financial Conduct Authority and the Bank of England.

The UK Financial Conduct Authority (FCA) has sent a letter to the Prime Minister providing an update on its growth strategy. It confirms delivery of most of the 50 pro-growth measures announced in January and outlines plans for 2026. The plans include finalising rules on stablecoins, setting out the delivery plan for open finance, reforming rules for venture capital and alternative investment fund managers and further speeding up IPO applications. The FCA also cites its plans to further overhaul mortgage rules so more people get on the housing ladder and is preparing for its expanded remit as anti-money laundering supervisor and integration of the UK Payments Systems Regulator. The letter highlights active support for firms digitising, with 31 already testing AI use cases, and commits to enabling tokenisation in asset management to drive efficiency and competition. The FCA also urges swift progress on digital ID to streamline know your customer requirements and calls for faster legislation to maintain reform momentum, including modernising the Consumer Credit Act. Finally, the FCA will use its convening power to galvanise system-wide responses to cross-cutting issues such as financial inclusion and mobilising defence investment to protect national and economic security.

The European Commission (EC) has published a Communication to the European Parliament, the European Council, the Council, the European Central Bank, the European Economic and Social Committee and the Committee of the Regions on further development of capital market integration and supervision within the Union, announcing a set of major legislative reforms. The package seeks to address obstacles to innovation and barriers to integration resulting from divergent rules, duplicative requirements and inconsistent supervision. The EC proposes a suite of amendments to key EU financial services and capital markets legislation in a package described as a central component of the savings and investments union (SIU), specifically a:

• Regulation which will amend: (i) the European Securities and Markets Authority (ESMA) Regulation; (ii) the European Markets Infrastructure Regulation (EMIR); (iii) the Markets in Financial Instruments Regulation (MIFIR); (iv) the Central Securities Depositories Regulation (CSDR); (v) the Distributed Ledger technology Pilot Regulation (DLTPR); (vi) the Markets in cryptoasset Regulation (MiCAR); and (vi) the Cross-Border Distribution of Funds Regulation (CBDR). 

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HM Treasury has published a policy update on creating a provisional licences authorisation regime for early-stage financial services firms seeking FCA authorisation. The purpose is to reduce the barriers that financial services firms face when seeking authorisation. The proposed "provisional licences" regime will enable the FCA to grant time-limited permissions (generally up to 18 months) so that firms can get "up and running" in a controlled environment with strong regulatory oversight, whilst working towards full authorisation. The policy update sets out details of how the government intends to deliver this. It discusses the purpose and design of the regime including its scope and eligibility, the duration of provisional licences and other restrictions and requirements on firms during the provisional licence period. It concludes with a discussion of exiting the regime, ideally with full authorisation. This provisional licence regime will require. primary legislation, and the updates reports that the government will take this forward when parliamentary time allows. The FCA will engage with industry on the design of the regime and consult as necessary.

The European Securities Markets Authority (ESMA) has issued a statement on the discretionary transitional regime for cryptoasset service providers (CASPs) that offered their services in accordance with applicable law prior to 30 December 2024, contained in the Markets in Cryptoassets Regulation (MiCAR). Member States may decide not to apply the transitional regime or to reduce its duration. Given the national divergence in transitional periods applicable across the EU member states, ESMA expects CASPs not yet authorised under MiCAR to have implemented orderly wind-down plans for the services they provided in member states in which the transitional period is over and orderly wind-down plans in place ready for implementation ahead of the end of the remaining transitional periods in case they should not be authorised by then.

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