The Treasury’s announcement on Crypto

On 4 April 2022 the Treasury announced that the UK is open to crypto business, stablecoins will be brought into FCA’s perimeter, and that it will consult on a future regulatory regime for the cryptoasset industry. The FCA welcomed the announcement and said they will continue to work closely with the government ahead of its consultation. They highlighted the CryptoSprint event 10-11 May as their main response to the changing landscape and a vehicle for industry to help inform our policy. 

Investing in crypto is high-risk.

While The FCA currently has limited powers, they are still acting to protect consumers, including through consumer campaigns and by banning the sale of crypto-derivatives to retail consumers. Further cryptoasset regulation is needed to ensure consumers and markets have sufficient protection as the industry evolves. 

The Temporary Registration Regime (TRR) for existing cryptoasset businesses was established in December 2020. It allows existing Cryptoasset firms, which applied for registration before 16 December 2020, and whose applications were still being assessed, to continue trading. The FCA have concluded their assessments, and the TRR closed on 1 April, for all but for a small number of firms where it is strictly necessary to continue to have temporary registration. This is necessary where a firm may be pursuing an appeal or may have particular winding-down circumstances. 

The FCA are pro innovation, but they won’t sacrifice their basic standards. 80% of firms that applied to the TRR couldn’t meet the standards required of all firms to prevent money laundering and terrorist financing.