UK’s FCA Seeks Crypto Feedback: Will it Fix the Chaos or Just Make It Worse?

by

Ah, the UK’s Financial Conduct Authority (FCA), ever the diligent shepherd of financial order, has decided to stir the crypto pot. Yes, they’ve launched a consultation to establish new, minimum standards for crypto firms. The idea is to sprinkle the magic dust of traditional finance on the wild, unkempt beast that is cryptocurrency. A noble cause, no doubt.

But wait-before we start singing hallelujahs for this valiant endeavor, let’s not forget that this same FCA, in its infinite wisdom, is seen by many as a slow, lumbering bureaucratic titan-its regulatory efforts often criticized as being more fragmented than a shattered mirror. A fine mess to be sure.

FCA Seeks Crypto Feedback (Oh, the Drama!)

Our good old FCA is asking for public feedback on this latest move. They’ve presented a set of proposed rules (that read like they’ve been lifted from the dusty archives of traditional finance) aimed at making crypto firms toe the line. You know, the usual stuff: resilience, effective systems, and of course, the ever-popular “we’ll prevent financial crime” mantra.

Ah, yes, the FCA has released its new consultation paper – CP25/25: Application of the FCA Handbook for Regulated Cryptoasset Activities – which looks at applying old-school financial rules to the new-age crypto world. You can almost hear the collective groan of crypto enthusiasts. 👉…

– CryptoUK 🇬🇧 (@CryptoUKAssoc) September 17, 2025

The goal is to make sure that UK crypto firms can hold their own on the global stage. But in a twist of irony, the FCA is also opening up a conversation about a brand-new principle that’s supposed to ensure firms operate in their customers’ best interests-because, apparently, crypto firms haven’t been doing that all along. 🙄

“We want to develop a sustainable and competitive crypto sector – balancing innovation, market integrity and trust. Our proposals won’t remove the risks of investing in crypto, but they will help firms meet common standards so consumers have a better idea of what to expect,” says David Geale, FCA’s executive director of payments and digital finance. Well, at least he’s optimistic.

Now, in true bureaucratic fashion, the FCA has set an October 15 deadline for feedback on this discussion paper and a November 12 deadline for the consultation paper. Get ready for a flood of feedback that may or may not move the needle.

Critiques of Existing UK Crypto Regulation (Spoiler: It’s Not Pretty)

The crypto community isn’t exactly sending love letters to the FCA. Far from it. They claim that the UK’s regulatory approach is slower than a snail on a Sunday afternoon. Many businesses, frustrated by the snail-like pace, have decided to pack their bags and leave for more crypto-friendly shores. 🛳️

Here’s where it gets juicy: the FCA, in its infinite wisdom, has been applying a blanket approach, treating all digital assets as high-risk speculative investments. The problem? Not all crypto is created equal. Some are stable, some are not. But the FCA doesn’t seem to care much about those pesky details. It’s the old “everything is the same” approach, which sounds remarkably like a lazy student who writes one essay for all subjects.

And then, of course, there’s the looming specter of the Cryptoasset Reporting Framework (CARF), which takes effect in January 2026. It’s supposed to catch tax evaders, but it also feels like an overzealous attempt to dig through everyone’s financial business. Privacy? Who needs it? Oh, and did we mention that small investors are now dragged into the tax net because of reduced tax-free allowances? Fun times ahead, eh?

So, will the FCA’s consultation save the UK’s tarnished reputation in the crypto world? Or will it end up as just another convoluted step in a bureaucratic waltz that no one really asked for? Only time-and feedback-will tell. But, oh, the drama.

Read More

2025-09-17 20:47