UK crypto regulation – July 2026 update: Where we are now and what you need to do

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In a series of previous blogs, Gherson’s White-Collar Crime team has been tracking the evolution of the UK’s cryptocurrency regulatory landscape. Starting from our initial examination of the HM Treasury Consultation Paper in February 2023, we have provided regular updates and have analysed the regulatory developments in this fast-moving area, including our update following HM Treasury’s October 2023 Response, our analysis of the 13 key takeaways from that consultation, our overview of the current state of crypto regulation, our consideration of the Money Laundering Regulations consultation and our broader 2025 legal overview.

This article summarises our previous publications and provides a comprehensive update on the current situation as of July 2026.

The story so far: a brief summary

Historically, cryptoassets in the UK were largely unregulated unless they crossed into the existing regulatory perimeter – for example, by qualifying as specified investments or e-money. Bitcoin and Ethereum were (and still are) classified as exchange tokens, meaning they do not constitute specified investments under the FSMA regime. However, this does not mean the FCA has no jurisdiction over activities involving them: financial promotions relating to cryptoassets (including Bitcoin and Ethereum) have been regulated since October 2023, and businesses providing exchange or custody services for such tokens have been required to register with the FCA under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (as  amended) since January 2020.

The major shift began with HM Treasury’s consultation in February 2023, which set out proposals to bring a far wider array of cryptoasset activities within the regulatory perimeter of the Financial Services and Markets Act 2000 (“FSMA”). The October 2023 Response confirmed that HM Treasury intended to proceed with these proposals, including regulated activities for public offerings, operating trading venues, intermediation services and custody provision.

In November 2024, the Government confirmed that it would implement these proposals largely unchanged and announced a phased approach, whereby the implementation of a comprehensive regulatory framework was targeted for 2026.

Key developments since our last update

1. The Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026

On 4 February 2026, the Parliament adopted the final draft of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 presented by HM Treasury, thereby formally bringing cryptoassets within the FCA’s regulatory remit.

This has become one of the most significant expansions of the FCA’s scope of oversight in years. The Regulations will amend the Regulated Activities Order and introduce new regulated activities for cryptoassets, meaning firms wishing to provide associated services in or to the UK will require FCA authorisation and supervision. The new regime is expected to come into force on 25 October 2027.

2. The FCA’s final rules and guidance (30 June 2026)

On 30 June 2026, the FCA published its final rules and guidance, completing its Crypto Roadmap. These rules will apply to all cryptoasset firms that have been granted permission to operate under FSMA on or after 25 October 2027.

The FCA’s extensive consultation process encompassed:

• CP25/14 – Stablecoin issuance and cryptoasset custody;
• CP25/15 and CP25/42 – A prudential regime for cryptoasset firms;
• CP25/25 and CP26/4 – Application of the FCA Handbook to regulated cryptoasset activities;
• CP25/40 – Regulating cryptoasset activities (trading platforms, intermediation, lending and staking);
• CP25/41 – Admissions, disclosures and market abuse.

3. The authorisation gateway

The FCA has confirmed that the authorisation gateway — the application window for firms seeking permissions under the new regime — will open on 30 September 2026 and close on 28 February 2027.

The FCA expects to make decisions before the regime commences on the applications submitted during this window. A saving provision in the statutory instrument allows firms to continue providing cryptoasset services until their application has been finally determined. Critically, firms that apply outside the application period or submit inadequate applications risk receiving a rejection, facing delays or being unable to continue with their cryptoasset activities when the new regime comes into force.

Pre-application support meetings are now available — the FCA’s Pre-Application Support Service (PASS) has been open for requests since 11 May 2026, with meetings taking place from July 2026. Firms should submit their request promptly to secure an early slot.

4. The Property (Digital Assets etc) Act 2025

On 2 December 2025, the Property (Digital Assets etc) Act 2025 received Royal Assent and came into force on the same date, without the need for a separate commencement order. Based on Law Commission recommendations, the Act confirms that a thing is not prevented from being the object of personal property rights merely because it does not fit within the traditional categories of things in possession or things in action.

This creates a statutory “third category” of personal property, into which crypto-tokens and other digital assets may fall. Crucially, this provides owners of digital assets with enforceable property rights, enabling them to seek legal redress in cases of theft or misuse.

5. Financial promotions enforcement

The FCA has demonstrated a willingness to take robust enforcement action. On 10 February 2026, the FCA publicised the commencement of proceedings against an offshore crypto platform for breach of the UK financial promotions regime — the first enforcement action since cryptoassets were brought within the scope of the financial promotions regime in October 2023.

The FCA has also taken action against unregistered cryptoasset activity, including prosecuting an individual operating illegal crypto ATMs and working with the Metropolitan Police Service to arrest individuals suspected of running an illegal cryptoasset exchange.

In 2025, the FCA placed restrictions on all six client-facing crypto firms registered that year, indicating a tightening of supervisory oversight.

The current situation (July 2026)

Until the new regime comes into force on 25 October 2027, the FCA’s oversight of crypto continues to be limited to two main areas:

1. Financial promotions: all communications constituting an invitation or inducement to engage in cryptoasset activity are subject to FCA regulation and must be clear, fair and not misleading;
2. Anti-money laundering: firms providing exchange or custody services must register with the FCA under the Money Laundering Regulations.

From 25 October 2027, the full suite of regulated activities will apply, including:

• Issuing qualifying stablecoins;
• Safeguarding (custody) of cryptoassets;
• Arranging deals in cryptoassets;
• Operating trading platforms;
• Intermediation;
• Lending and borrowing;
• Staking.

The FCA will publish a further policy statement in September 2026 on how the regulatory perimeter applies to cryptoasset activities, along with further guidance on DeFi and operational resilience.

Bite-sized advice

For firms operating in the cryptoasset space:

• Start preparing now: the authorisation gateway opens on 30 September 2026. Do not treat October 2027 as a distant deadline — your preparation, such as conducting a perimeter analysis, introducing governance arrangements and building systems, must begin well in advance;
• Conduct a perimeter analysis: assess whether your activities will fall within the scope of one or more regulated cryptoasset activities. If you are unsure, accelerate your scoping work or risk missing the application window;
• Gather documentation for your licence application: begin assembling business plans, risk assessments, security policies, governance frameworks and financial resource projections;
• Review your financial promotions: non-compliance is a criminal offence and could jeopardise future applications for authorisation. Ensure all communications are clear, fair, not misleading and carry the FCA-mandated high-risk warning, where necessary;
• If you are an MLR-registered firm providing on/off ramp services to unregistered firms, be aware that the FCA expects you to understand and meet your own obligations, including assessing whether your partners are complying with the financial promotions rules;
• Do not be complacent: the FCA has placed restrictions on newly registered crypto firms and has initiated enforcement proceedings. Firms exiting the EU market following MiCA coming fully into force from 1 July 2026 demonstrate the real-world consequences of failing to prepare.

For individual investors and token holders:

• Your digital assets now have legal recognition as property: the Property (Digital Assets etc) Act 2025 enables you to seek legal remedies if your crypto-tokens are stolen or misappropriated;
• Check the FCA Warning List before dealing with any cryptoasset firm. Verify that a firm is registered or authorised before investing;
• Be wary of promotions that do not comply with FCA rules: if a promotion does not contain the required risk warnings or appears to be from an unregistered overseas platform, exercise extreme caution;
• Understand that most cryptoassets remain unregulated until October 2027: until the new regime commences, you will not benefit from the protections that full FCA regulation will bring, such as conduct-of-business rules and prudential requirements.

For legal and compliance professionals:

• Familiarise yourself with the FCA’s final rules published on 30 June 2026. The package is substantial — estimated at over 1,000 pages of rules and guidance — and covers authorisation, conduct, disclosures, market integrity and financial resilience;
• Monitor further consultations: the FCA is expected to consult on DeFi guidance, operational resilience for DLT firms and updates to the Financial Crime Guide later in 2026;
• Remember the broader international context: whilst the EU’s MiCA has introduced a pan-European licensing regime, the UK’s more iterative approach means firms must stay attuned to evolving guidance rather than treating any single publication as the final word.

Looking ahead

The UK’s approach to crypto regulation has moved from a piecemeal, largely unregulated landscape to what will, from October 2027, be a comprehensive FSMA-based framework. The journey, which we have tracked through this blog series, has been characterised by extensive consultation, phased implementation and increasingly assertive behaviour on the part of the FCA.

For firms, the message is clear: the regulatory train has left the station and will not wait for those who delay their preparations. For individuals, the combination of property law reform and incoming conduct regulation marks a significant improvement in legal protections.

Frequently asked questions

What are the UK’s new cryptoasset regulations?

The Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 establish a new regulatory framework for cryptoasset activities in the UK. From 25 October 2027, firms carrying out regulated cryptoasset activities will generally require FCA authorisation and will be subject to ongoing regulatory requirements.

When do crypto firms need to apply for FCA authorisation?

The FCA’s authorisation gateway is expected to open on 30 September 2026 and close on 28 February 2027. Firms wishing to continue providing regulated cryptoasset services should begin preparing well in advance, as applications will require detailed governance, compliance and operational information.

Does the Property (Digital Assets etc) Act 2025 change the legal status of cryptoassets?

Yes. The Property (Digital Assets etc) Act 2025 confirms that digital assets can benefit from personal property rights, even though they do not fall within the traditional categories of property. This strengthens the legal protection available to owners in disputes involving theft, fraud or unauthorised transfers.

Are cryptoassets currently regulated in the UK?

At present, UK regulation remains limited in scope. Financial promotions relating to cryptoassets are regulated, and certain cryptoasset businesses must comply with anti-money laundering requirements and register with the FCA, where applicable. The broader FSMA regulatory framework is due to take effect from 25 October 2027.

What should cryptoasset businesses do now?

Businesses should assess whether their activities are likely to fall within the new regulatory perimeter, review their governance and compliance arrangements, prepare for FCA authorisation and ensure that all financial promotions comply with current FCA requirements. Early preparation can help reduce regulatory risk and avoid disruption when the new regime comes into force.

How we can help

Gherson’s Regulatory, White-Collar Crime and Investigations team are able to provide advice and assistance with AML, regulatory and sanctions compliance, including in situations involving cryptoassets. Whether you need help navigating the authorisation process, reviewing your financial promotions for compliance, understanding the implications of the Property (Digital Assets etc) Act 2025 or responding to FCA enforcement action, please do not hesitate to contact us.

If you have any questions arising from this blog, please do not hesitate to contact us for advice, send us an e-mail, or, alternatively, follow us on X, Facebook, Instagram, or LinkedIn to stay-up-to-date.

The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please do not hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

©Gherson 2026