The UK’s Financial Conduct Authority (FCA) began accepting applications for cryptoasset authorisation on September 30. The regulator urged firms seeking to continue operating in the country to apply by February 28, 2027, ahead of the new regime taking effect on October 25, 2027.
According to the FCA, applicants will be assessed on consumer protection, safeguarding of customer assets, market integrity and financial resilience. Submitting an application will not guarantee approval; firms that fail to meet the required standards will not receive authorisation under the new regime.
FCA will assess crypto firms across four key areas
The application process marks the implementation phase of the UK’s plan to bring the crypto sector under broader regulatory oversight. The FCA requires firms to demonstrate clearly that they meet its standards.
Dominic Cashman, the FCA’s director of authorisation, said the new regime would give consumers stronger protections and firms a clear framework in which to operate. The regulator is also supporting applicants through pre-application meetings and webinars.
Existing firms that apply during the application window may continue providing services under the relevant conditions if their applications remain under review when the new rules take effect. This will also allow them to take on new business while awaiting a decision.
Existing registrations will not automatically become authorisations
The FCA’s application guidance sets out a separate requirement for firms registered under anti-money laundering regulations. Existing registration under the Money Laundering Regulations (MLRs) will not automatically convert into authorisation under the new system.
These firms will need to obtain the necessary authorisation under the Financial Services and Markets Act. Businesses already authorised for other financial activities will need to extend their existing permissions to cover cryptoasset services.
Firms will submit their applications through the FCA’s Connect system. An existing registration or authorisation relationship with the regulator will therefore not remove the requirement to apply for the relevant cryptoasset permissions.
Firms that miss the application window will face restrictions
February 28, 2027, does not mark the end of all opportunities to apply. However, firms applying after that date will not receive an expedited assessment to compensate for their late submission.
Late applicants that have not secured authorisation when the regime begins will fall under transitional provisions. They will only be allowed to conduct activities necessary to fulfil existing contracts and will be unable to enter into new contracts with either existing or new UK customers.
Firms that do not apply before the new regime begins will need to wind down their relevant UK cryptoasset business by that date. The application timetable will therefore directly affect their ability to accept customers and maintain services.
Trading platforms, custody and staking services fall within scope
The FCA’s perimeter guidance, published on September 16, explains which activities will fall under the regime. It covers issuing qualifying stablecoins, operating cryptoasset trading platforms, dealing and arranging deals, safeguarding assets and arranging staking services.
Firms will need to determine which permissions their products and services require based on their business models. The FCA will also consult in October on targeted updates to the guidance following limited legal exclusions and clarifications affecting certain technical service providers.
The final rules announced on June 30 include financial resilience requirements such as capital standards and stress testing. The framework also introduces provisions addressing insider trading and market manipulation.
The FCA says it will apply established financial services standards to crypto firms where the risks are comparable. This includes the Consumer Duty rules governing firms’ responsibilities toward consumers.
Until the new rules take effect in October 2027, the FCA’s oversight in this area will remain largely limited to financial promotions and anti-money laundering controls. The regulator also stresses that broader regulation will not eliminate the risks associated with crypto investments.
