FCA consults on UK crypto rules for exchanges, lending and DeFi
The United Kingdom’s Financial Conduct Authority (FCA) has opened three consultations on proposed rules for digital asset markets, covering crypto exchanges, intermediaries, staking, lending and borrowing, market abuse, disclosures and decentralized finance (DeFi). The FCA said feedback will be accepted until Feb. 12, 2026.
The regulator said the proposals are intended to foster innovation while ensuring consumers understand the risks of investing in crypto assets. It added that regulation should not remove risk entirely but require responsible and transparent practices by market participants.
“Our goal is to have a regime that protects consumers, supports innovation and promotes trust,” said David Geale, the FCA’s executive director for payments and digital finance, noting that industry input will inform the final rules.
From promotions to market structure
The consultations represent the next phase of the U.K.’s move toward full “market structure” requirements for crypto, expanding beyond earlier rules centered on financial promotions and Anti-Money Laundering compliance.
Under the proposals, trading platforms would be subject to clearer standards on admissions, disclosures and trading integrity. Measures addressing insider dealing and market manipulation would bring crypto market oversight closer to that of traditional financial markets.
The FCA is also seeking views on crypto staking services, including how firms should present risks for yield-bearing products that require locking customer assets. Lending and borrowing activities are included, with proposed safeguards aimed at protecting both borrowers and lenders.
The consultation considers whether DeFi activities — such as trading, lending and borrowing conducted without intermediaries — should be held to the same regulatory standards as conventional financial services.
While the consultations proceed, Geale reminded consumers that most crypto activities remain outside the regulatory perimeter. He said crypto is largely unregulated at present, except in areas related to financial promotions and financial crime.
UK plans to expand financial rules to crypto
The FCA’s consultation launch follows the U.K. government’s announcement of plans to introduce a bill to extend the country’s financial sector laws to crypto assets by 2027.
On Monday, the finance ministry said it intends to introduce legislation to bring crypto companies under existing financial laws by October 2027, placing them under FCA oversight.
U.K. Chancellor Rachel Reeves said bringing crypto within the regulatory perimeter is a “crucial step” in maintaining the country’s position as a financial center in the digital era.
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