The UK’s top financial regulator preparing to roll out full crypto regulations in 2026, but with an approach very different from traditional finance. Instead of applying banking-style rules to the fast-changing digital asset market, the Financial Conduct Authority (FCA) wants a framework that better fits the risks and realities of crypto.
The move signals crypto is different, and it needs its own rulebook.
Why Old Rules Don’t Fit New Assets
At the heart of the plan is a simple idea, old financial templates don’t fit a market built on permissionless technology and extreme volatility.
David Geale, the FCA’s executive director for payments and digital finance, explained that simply copying banking rules onto crypto would not work. “If it’s the same risk, you go for the same regulatory outcome, but some of these things are very different.
Unlike banks, crypto firms run on different technology and face unique challenges such as extreme volatility and cyber threats.
Geale said that companies will not be forced to follow every rule in the FCA’s handbook. Requirements around senior management controls, cooling-off periods for buyers, and traditional product oversight will be relaxed because blockchains operate without the intermediaries that regulators usually monitor.
Where the FCA will tighten the rules?
At the same time, the regulator plans to be tougher in areas that matter most to digital assets, technology and users security. With hacks and outages being frequent in the crypto world, Cybersecurity will be a top priority, especially after incidents like the $1.5 billion Bybit wallet hack.
Firms will also be required to show strong operational resilience, since crypto operates 24/7 and outages can cause major disruption.
Balancing Growth With Safety
For years, UK crypto firms only faced AML and KYC checks. But now, with the US moving faster under its new pro-crypto stance, the UK faces pressure to create a system that both protects investors and supports growth.
The FCA says that its approach is not about lowering standards, but about making them fit for purpose. The goal is to give consumers clear warnings about the risks of losing all their money, while aiming to make the UK a digital asset hub.
The FCA is now seeking feedback if Consumer duty and Ombudsman rights should apply to crypto users. Although, the final framework in 2026 could shape how the UK competes in global digital finance.
