The UK Financial Conduct Authority (FCA) is taking steps to refine regulations for the crypto sector through a public consultation, as announced on Dec. 16. This move reflects the FCA’s dedication to creating a regulatory framework that fosters innovation while addressing risks prevalent in the crypto industry, such as market abuse, financial fraud, and lack of transparency in disclosures.
The proposed regulations aim to enhance transparency, promote fair trading practices, and ultimately build a trusted and sustainable crypto market in the UK. The FCA is seeking to establish clear guidance to ensure consumer protection and encourage long-term investment in the sector. One key aspect of the proposed measures is the sharing of information among authorized crypto trading platforms to combat market abuse and reduce fraudulent activities.
In addition to addressing market abuse and fraud, the FCA’s regulatory efforts will focus on preventing the proliferation of fraudulent tokens and cracking down on unregistered crypto firms. While there may be limitations on public offerings of certain cryptocurrencies, compliant platforms and services will be granted specific exemptions under the proposed regulations.
The public consultation forms part of the UK government’s broader strategy to establish a comprehensive legal framework for the crypto industry. This framework, which is set to be finalized in 2026, will cover various aspects of crypto trading, stablecoin oversight, asset custody, and more. The FCA’s collaboration with industry stakeholders and regulators aims to create an environment that fosters innovation while upholding market integrity and consumer protection.
The consultation period is scheduled to run from Dec. 16 to March 14, 2025, during which the FCA is encouraging input from firms, legal experts, and individuals in the crypto industry. The regulator emphasizes the importance of collaboration with the government, international partners, industry stakeholders, and consumers in shaping the future regulatory framework for crypto. By seeking input from a diverse range of stakeholders, the FCA aims to develop a fair, balanced, and proportionate regulatory regime that meets the needs of all parties involved.