On 17 September 2025, the FCA published a comprehensive consultation paper on the application of the FCA Handbook for regulated cryptoasset activities. This development follows HM Treasury's publication of the draft statutory instrument and policy note in April 2025, which we covered in our previous blog post and represents the next step in establishing the UK’s comprehensive cryptoasset regulatory framework.
Same Risk, Same Regulatory Outcome
The FCA’s consultation focuses on the overarching principle of “same risk, same regulatory outcome” meaning that cryptoasset firms will generally be subject to the same regulatory standards as traditional financial services firms. The regulator intends to apply the majority of existing FCA Handbook rules and guidance to cryptoasset activities without modification.
However, the consultation acknowledges that the unique characteristics of cryptoassets may require some tailored approaches. The FCA is considering targeted disapplication of specific rules where they may not be appropriate for cryptoasset activities, and recognises that some areas may require enhanced protections, particularly around cybersecurity risks.
The FCA consultation addresses how the existing FCA Handbook rules will apply to cryptoasset firms, covering several areas:
- The consultation covers the application of high-level standards including the Principles for Business, General Provisions and Supervision sourcebooks, and the Senior Management Arrangements, Systems and Controls sourcebook (SYSC). The SYSC application includes governance, senior managers and certification regime, financial crime and operational resilience requirements.
- The consultation also specifically addresses the application of business standards, particularly the ESG sourcebook requirements for cryptoasset firms.
- The FCA provides guidance in chapter 4 to assist firms in meeting operational resilience requirements, including specific guidance and examples for qualifying stablecoin issuers, qualifying cryptoasset trading platforms, firms offering qualifying cryptoasset staking, and firms providing cryptoasset custody services.
The FCA is also consulting on how several consumer protection frameworks will apply to cryptoasset firms, including Consumer Duty, conduct of business rules, product governance requirements, and dispute resolution mechanisms.
Next Steps and Timeline
The FCA is welcoming comments on discussion proposals by 15 October 2025 and comments on consultation proposals by 12 November 2025.
The application of the FCA Handbook means cryptoasset firms will need to implement comprehensive compliance frameworks equivalent to traditional financial services firms. This includes robust governance structures and extensive systems and controls.
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