Authorized trading platforms and other firms meeting strict criteria may qualify for exemptions under the new proposed rules.
By Chimamanda U. Martha
Edited by Marco T. Lanz
Updated
3 mins read
The Financial Conduct Authority (FCA) of the United Kingdom has released a new consultation paper, proposing a sweeping ban on issuance of crypto offerings by firms that are not regulated under its jurisdiction. The move is part of the country’s effort to tighten its grip on the rapidly evolving crypto sector.
The proposal, detailed in the Discussion Paper DP24/4, seeks to establish robust rules governing the admission and disclosure of crypto assets while expanding measures to curb market abuse. According to the announcement on Monday, the initiative builds upon earlier restrictions, including bans on unregistered crypto promotions last year.
The FCA said its primary goal with the proposed ban is to reduce risks to consumers and ensure market integrity. The regulator believes that targeting unregulated firms will prevent fraud, manipulation, and other illicit activities that have long been associated with the crypto sector.
Some key objectives outlined by the market watchdog include improving regulatory clarity, empowering consumers by requiring firms to provide comprehensive disclosures, as well as fair market practices.
The FCA’s initiative represents a broader strategy to bring crypto activities under its regulatory umbrella. While its current remit includes anti-money laundering (AML) compliance and restrictions on unregistered promotions, the new rules will extend to core activities such as crypto trading, custody, and stablecoin regulation.
The framework will restrict non-regulated firms from offering cryptocurrencies to the public, though the FCA has outlined potential exceptions for authorized trading platforms and firms meeting specific regulatory criteria.
While the details of these exceptions remain under discussion, the FCA is inviting input from industry participants and other stakeholders.
The FCA is actively seeking feedback from a diverse range of stakeholders, including crypto firms, traditional financial institutions, academics, and consumer groups. Through policy roundtables and consultations, the regulator aims to address industry concerns while ensuring that its rules are comprehensive and effective.
According to the announcement, public consultations on the new rules will remain open until March 2025. Draft legislation to formalize the FCA’s proposals is expected in 2025, with a full regulatory framework slated for implementation by 2026.
The proposal underscores the FCA’s commitment to finding a balance between fostering technological progress and protecting consumers. Recognizing the potential of blockchain and digital assets, the regulator aims to create an environment that supports innovation while addressing the risks of fraud and abuse.
Disclaimer: Coinspeaker is committed to providing unbiased and transparent reporting. This article aims to deliver accurate and timely information but should not be taken as financial or investment advice. Since market conditions can change rapidly, we encourage you to verify information on your own and consult with a professional before making any decisions based on this content.
Chimamanda is a crypto enthusiast and experienced writer focusing on the dynamic world of cryptocurrencies. She joined the industry in 2019 and has since developed an interest in the emerging economy. She combines her passion for blockchain technology with her love for travel and food, bringing a fresh and engaging perspective to her work.
