UK FCA consults on rules and guidance for regulated cryptoasset activities (part II)

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.

This paper sets out proposals on how the consumer duty will apply to cryptoasset firms, supported by further non handbook guidance and accompanied by a separate guidance consultation on the application. It also outlines the FCA's proposed approach to redress and dispute resolution under the Dispute Resolution (DISP) sourcebook, the application of various Conduct of Business Standards (COBS) requirements, the use of credit cards to purchase cryptoassets and the FCA's expectations for staff training and competence, as well as regulatory reporting obligations under SUP 16. In addition, the FCA is consulting on the application of cryptoasset safeguarding rules to firms undertaking more than one regulated cryptoasset activity, including its proposed approach to specified investment cryptoasset custody. The paper also addresses the treatment of retail consumers' collateral in the context of retail cryptoasset borrowing and proposes new location based policy guidance for cryptoasset firms (set out in Annex 4). The FCA further seeks views on its approach to international cryptoasset firms operating in or into the UK.

Separately, in CP25/25, the FCA had consulted on applying SUP 3.3–3.8 to qualifying cryptoasset custodians and stablecoin issuers, covering the appointment and independence of auditors, firms' cooperation duties, notification requirements, and auditors' rights and responsibilities. The FCA now invites feedback on whether these requirements should similarly extend to firms conducting other regulated cryptoasset activities, reflecting the existing approach taken in traditional financial services. In parallel, the FCA's Cost Benefit Analysis (CBA) Panel has published its advice on the consultation's CBA.

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