Reed Smith Client Alerts

Key takeaways

  • FCA has proposed applying core Handbook rules to UK cryptoasset firms under new regulatory regime, with certain modifications
  • Cryptoasset firms must meet governance, operational resilience, and senior management standards
  • FCA supervision and enforcement will focus on cryptoasset firms posing greatest risk
  • Responses are required for discussion proposals by 15 October 2025 and for consultation proposals by 12 November 2025

Authors: Brett Hillis Romin Dabir Gabrielle Butler, Tom Lewis

On 17 September 2025, the Financial Conduct Authority (FCA) published Consultation Paper CP25/25: Application of FCA Handbook for Regulated Cryptoasset Activities (the Paper). The Paper outlines how the FCA intends to apply existing cross-cutting Handbook provisions to firms that will be undertaking newly regulated cryptoasset activities once the Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025 (Draft SI) comes into effect.

The consultation period remains open until 12 November 2025 (for responses to Chapters 1 to 5) and until 15 October 2025 (for the discussion topics in Chapters 6 and 7). Final rules are expected in 2026.

Background

In April 2025, HM Treasury issued the Draft SI. This instrument will amend the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 and bring within scope a number of cryptoasset activities, including the issuance of qualifying stablecoins, the safeguarding of qualifying cryptoasset trading platforms, intermediation, and staking. Once the Draft SI comes into force, any firm that wishes to carry out these activities by way of business in the UK will need to seek authorisation from the FCA.