TL;DR: The FCA is consulting on updated financial crime guidance for crypto businesses, including customer checks, blockchain analytics and the Travel Rule. Responses are due December 24, and the guide itself would not create new rules.

Crypto businesses preparing for the UK’s expanded regulatory regime have a more detailed picture of the controls the Financial Conduct Authority expects them to build.

The regulator’s October 23 consultation proposes changes to its Financial Crime Guide, covering cryptoassets alongside fraud, sanctions, data security and money laundering. The proposals apply to the FCA’s financial crime supervisory population, including cryptoasset businesses and firms overseen under the Money Laundering Regulations.

The practical focus is on how firms assess customers and transactions, and how they react when risk changes. A blockchain record can help an investigation, but a record alone does not decide whether a customer explanation is credible or a transfer needs further scrutiny.

Analytics Must Sit Inside A Working Control System

The consultation paper proposes examples of good and poor practice for enhanced due diligence, onboarding and transaction monitoring. It specifically addresses the use of blockchain analytics and further guidance on the Travel Rule, which concerns information accompanying certain transfers.

The paper also reminds firms that governance must evolve as their businesses grow. Its proposed changes include a question about whether policies and staff training distinguish obligations under proceeds-of-crime legislation from those under terrorism legislation.

For an exchange or provider of custody, the implication is that buying a screening product is only one part of the job. Someone still has to set its thresholds, review alerts and document decisions. A technically accurate warning is of limited use if it sits unreviewed while funds move elsewhere.

That matters for stablecoin transfers as much as for volatile tokens. A stable unit price does not establish the identity of a sender or the origin of funds. Transaction risk and market risk are different questions, and control systems need to reflect that distinction.

Guidance Now, A Wider Regime In 2027

The FCA says the guide contains no rules and imposes no new requirements. It is intended to help firms understand supervisory expectations and assess their own arrangements. The consultation closes on December 24, after which the regulator plans to publish feedback and the final text in a policy statement.

Separately, the FCA’s regime overview says the wider cryptoasset framework is expected to begin on October 25, 2027. Applications for authorization are already open, and the regulator published a package of final rules in June.

The distinction between those stages matters for firms planning investment in compliance. This consultation does not postpone existing anti-money-laundering duties until next year, nor does it bring the whole future regime into force immediately. It fills in the proposed guidance firms can use when translating their obligations into day-to-day decisions.

Written by the News Desk and edited by Samuel Rae.

Bitcoin Magazine

UK Brings Crypto Under Full FCA Oversight for the First Time

The UK’s Financial Conduct Authority has opened applications for crypto firms to become authorized, bringing the sector under full regulation for the first time.

In a Wednesday announcement, the watchdog said companies can apply so that the crypto industry has “clarity and legitimacy.”

The UK is in the process of drafting a sweeping new crypto bill. The FCA finalized its regulatory framework for cryptoassets in June, and the regime is due to take effect in October 2027.  

“The UK’s new crypto regime will give consumers greater protections and firms a clear framework to operate in. Firms can now apply for authorisation and start preparing for regulation,” Dominic Cashman, director of authorisation at the FCA, said in a statement. 

The statement added that firms will have to demonstrate that they meet requirements covering consumer protection, customer-asset safeguarding, market integrity and financial resilience.

Britain is pushing ahead with digital asset legislation since last year recognizing bitcoin and other digital assets as property. The reform came from a 2023 recommendation by the Law Commission, which argued that digital assets did not fit neatly into existing legal categories.

Despite the FCA’s announcement, the UK currently is trailing behind Brussels and Washington with digital asset regulation. 

The EU’s Markets in Crypto-Assets regulation has applied to service providers since 30 December 2024. 

And the U.S. under President Donald Trump signed the GENIUS Act into law in July 2025, establishing a federal framework for dollar-backed tokens.

Despite lawmakers blocking landmark legislation the Clarity Act last month, U.S. regulators like the Securities and Exchange Commission have pushed ahead with rulemaking regardless. 

This post UK Brings Crypto Under Full FCA Oversight for the First Time first appeared on Bitcoin Magazine and is written by Mathew Di Salvo.