The draft Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025 laid before Parliament

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.
• Make consequential amendments to existing anti-money laundering and financial promotions requirements for cryptoasset firms to reflect the new regulatory perimeter.
• Introduce new designated activities under Part 5A of FSMA (as amended by FSMA 2023) for public offers and admissions to trading of qualifying cryptoassets, and to complement the FCA's regulatory oversight of the issuance of a qualifying stablecoin in the UK by a person with a Part 4A permission to carry on the regulated activity in a new article 9M of the RAO. Public offers of qualifying cryptoassets are prohibited unless an exception applies within Schedule 1 of the SI.

The framework also establishes market abuse provisions for cryptoassets, prohibits insider dealing, the unlawful disclosure of inside information and market manipulation, and imposes requirements in relation to disclosure and market abuse related systems and controls. The transitional and savings provisions 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. The regime's go-live date is 25 October 2027.

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