- Crypto firms in the UK will follow financial rules for transparency, conduct and consumer safeguards starting Oct 2027.
- FCA and Bank of England frameworks for trading, custody, issuance and stablecoins will finalize by end of 2026.
- UK bans political donations via crypto and aligns regulations with U.S. approaches, ensuring legal clarity for firms.
Britain will begin regulating cryptocurrencies from October 2027, bringing digital assets under standard financial laws. The UK Treasury confirmed the plan naming the Financial Conduct Authority as supervisor. Chancellor Rachel Reeves said the move aims to protect consumers, block illicit activity and give firms legal clarity through legislation introduced to Parliament the same day.
Treasury Moves Crypto Into Financial Law Framework
Under the proposal, crypto assets will fall inside the existing financial regulatory perimeter. Therefore, exchanges, wallet providers, and service firms must meet the same standards as other financial companies.
According to the Treasury, these rules will cover transparency, operational conduct, and consumer safeguards. Rachel Reeves stated that the framework will provide clear operating rules while strengthening consumer protection.
Notably, Lucy Rigby, minister for the City of London, added that clarity will help firms plan long-term operations. Recent data from the FCA shows about 12% of UK adults now hold cryptocurrency, reflecting steady adoption.
Earlier, Parliament recognized Bitcoin and other digital assets as legal property. As a result, holders can own, inherit and recover crypto under UK law. This step connects directly to the broader regulatory expansion planned for 2027.
FCA and Bank of England Rulebooks Due by 2026
Alongside Treasury action, regulators are preparing detailed rulebooks. The FCA is drafting standards for trading, custody, issuance, and market abuse. Meanwhile, the Bank of England released proposals to regulate stablecoins used for payments.
Both regulators said they will finalize their frameworks by the end of 2026. These timelines aim to prepare firms before full enforcement begins. However, regulators continue to warn that crypto investments carry significant risk.
Official data shows UK investment scam losses rose 55% year-on-year. Importantly, crypto-related schemes accounted for the largest share of losses.
Political Donation Ban and Global Coordination
Separately, ministers are drafting plans to ban political donations made using cryptocurrency. Officials cited difficulties verifying fund origins and ownership. This proposal follows wider concerns over traceability and enforcement.
Internationally, Britain is aligning with U.S. regulatory approaches rather than the EU’s MiCA framework, which began in 2024. The Treasury confirmed collaboration with U.S. authorities through a transatlantic taskforce. Daniel Slutzkin of Gemini told Reuters that firms have long awaited this regulatory certainty.
