FCA Launches Major Consultation on Crypto Rules with February 2026 Deadline

The UK's Financial Conduct Authority (FCA) has initiated a public consultation on crypto asset regulation. This follows the government's announcement that formal regulations will be in place by October 2027.

The consultation seeks input from firms, investors, and the public on new crypto rules.
Recent FCA research indicates a decline in UK crypto ownership from 12% to 8% over the past year.
The UK aims to model its crypto regulation approach after the US, rather than the EU.

Proposed Regulatory Coverage

The rules will apply traditional finance principles to crypto markets, requiring transparency and risk disclosure.
They cover listing standards, trading platform requirements, broker regulations, and measures against insider trading and market manipulation.
Other areas include crypto staking, lending and borrowing services, and DeFi.
Feedback is sought on whether existing financial rules should apply to DeFi services.

Margin Trading and Borrowing

Individuals may trade borrowed crypto assets, potentially increasing gains or losses.
Platforms won't need credit checks but will require collateral exceeding the borrowed amount, with losses limited to posted collateral.

The consultation is open until 12 February 2026, with final rules expected by the end of 2026.