In a new set of rules for the crypto sector, the U.K.’s Financial Conduct Authority (FCA) is easing the proposed requirements on stablecoin issuers.
The regulator issued a series of policy statements, setting out its new regime for regulating the crypto sector, which is due to come into effect in October 2027. The rules introduce new standards for trading, along with capital and stress testing requirements, and conduct rules to guard against insider trading and market manipulation.
The new framework will also set specific rules for stablecoins, which is the one area where the FCA announced significant changes to its original proposals — including cutting the capital requirements for new issues in half, simplifying its approach to market risk-based capital standards and easing the disclosure requirements.
“Following consultation, the FCA has simplified key elements of the regime to make it more workable in practice including simpler capital requirements for stablecoin firms and tailoring trading rules to better reflect how crypto markets operate,” the regulator said.
Firms will be able to start applying for authorization to operate under the new rules starting in October, so they are ready to function when the new regime comes into force on Oct. 25, 2027.
“This is a significant moment for crypto regulation in the U.K.,” said David Geale, executive director of payments and digital finance at the FCA, in a release.
“We’ve created a framework that doesn’t force firms to choose between regulatory certainty and room to innovate — this regime means they can have both in a stable, competitive home to build and grow,” he said. “For consumers, it means firms will be held to similar standards to other financial providers, though we can’t regulate away risk.”
The FCA said it intends to issue further guidance in September that will set out how the regulatory perimeter applies to cryptoasset activities. It will also consult on decentralized finance (DeFi) guidance, financial crime guidance for crypto firms and how the FCA’s rules will apply when a stablecoin issuer is recognized as systemic by HM Treasury.
“This marks an important step forward,” said Emma Joyce, Head of EMEA, Global Blockchain Business Council. “Standards are what make markets work: they create the trust and common foundation needed for an industry to scale responsibly — and that is essential to the U.K.’s strength as a global financial hub.”