FCA sets out tougher framework for crypto firms under CP26/4
The post FCA sets out tougher framework for crypto firms under CP26/4 appeared on BitcoinEthereumNews.com.
The UK’s Financial Conduct Authority has published Consultation Paper CP26/4, which outlines how its regulatory handbook will apply to firms carrying out newly regulated cryptoasset activities. The proposals outline standards of conduct, consumer protections, rules on safeguarding, and expectations for international firms looking to access the UK market. Under CP26/4, the FCA has proposed that the Consumer Duty be applied to crypto firms in the same way as it is for other authorized firms. As a result, firms that serve retail customers would have to show fair value, transparent disclosures, and effective consumer support. However, the Duty would not apply to trading between participants on a UK authorized qualifying cryptoasset trading platform. The FCA’s draft guidance outlines who qualifies as a product manufacturer in crypto markets. Issuers of qualifying cryptoassets or stablecoins, crypto lending and borrowing platforms, and UK trading platforms would be included in that category. Complaints, ombudsman oversight, and limits on compensation CP26/4 confirms that crypto firms would be subject to the standard complaint-handling rules of the FCA. Formal procedures and strict response timelines would be in place, bringing crypto firms into line with established financial services practices. The proposals would also include crypto activities under the Financial Ombudsman Service. The ombudsman would be able to issue binding awards of up to GBP350,000, providing the consumer with redress that many crypto firms have not yet offered. At the same time, the regulator does not intend to extend the Financial Services Compensation Scheme to crypto activities. Customers would not be compensated for investment losses if a crypto firm fails. Safeguarding, reporting, and a higher bar for global firms The consultation also alters the way client cryptoassets must be protected. Firms that deal, operate trading platforms, issue stablecoins, or provide custody could be subject to the FCA’s client asset rules. Client…
Filed under: News - @ January 31, 2026 10:24 am