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

(9M) (1) Issuing a qualifying stablecoin is a specified kind of activity. (2) A person (“A”) “issues” a qualifying stablecoin if— (a) A offers, or arranges for another to offer, a qualifying stablecoin for sale or subscription from an establishment in the United Kingdom, or has previously done so, whether before or on or after the coming into force of this article, (b) the qualifying stablecoin was created by, or on behalf of, A or a member of A’s group, and (c) A carries on both the following activities from an establishment in the United Kingdom— (i) undertaking, or arranging for another to undertake, to redeem the qualifying stablecoin; (ii) holding, or arranging for another to hold, fiat currency or other assets for the purpose of maintaining the stable value of the qualifying stablecoin, as mentioned in article 88G(2)(a). (3) The activity in paragraph (2)(a) does not include the minting of a qualifying stablecoin, such that it first exists— (a) as an identifiable asset on the blockchain, and (b) in a transferable form. (4) For the purposes of paragraph (1)— (a) A is to be considered as carrying on or having carried on the activity in paragraph (2)(a) where A accepts an invitation from another person (“B”) for B’s purchase of a qualifying stablecoin; (b) A is to be considered as carrying on the activities in paragraphs (2)(a) and (2)(c)(ii), and as having created the qualifying stablecoin for the purposes of paragraph (2)(b), where A has assumed (by assignment, variation, operation of law or by any other similar mechanism) an undertaking to redeem the qualifying stablecoin; (c) where all of the activities in paragraph (2)(a) and (c)(i) and (ii) are carried on by another person (“B”) under arrangements made by A, then only A is to be considered as carrying on the activity specified in paragraph (1), not B. (9N) (1) The following are specified kinds of activity— (a) the safeguarding of a qualifying cryptoasset or a relevant specified investment cryptoasset (“the cryptoasset”) on behalf of another person (“A”); (b) arranging for a person to carry on that activity. (2) For the purposes of paragraph (1)(a)— (a) a person (“C”) is to be regarded as safeguarding the cryptoasset if C has control of the cryptoasset through any means that would enable C to bring about a transfer of the benefit of the cryptoasset to another person, including C; (b) “on behalf of another” includes where that other person, A, has— (i) both legal and beneficial title to the cryptoasset; (ii) the beneficial title only to the cryptoasset; (iii) subject to sub-paragraph (c), a right against C for the return of the cryptoasset; (c) subject to sub-paragraph (d), sub-paragraph (b)(iii) does not apply where A’s right against C for the cryptoasset arises in the following circumstances— (i) C received the cryptoasset from A under a title transfer cryptoasset collateral arrangement, or (ii) C acquired the cryptoasset from A under an agreement, pursuant to which A contracted to buy back the cryptoasset from C; (d) sub-paragraph (c) does not apply where A is— (i) a consumer, or (ii) specified, or of a description specified, in rules made by the FCA. (3) Rules made by virtue of paragraph (2)(d)(ii) may— (a) specify a particular person or class of persons; (b) be limited so as to apply only to agreements or arrangements, or classes of agreements or arrangements, specified by the rules. (4) For the purposes of paragraph (2)(a), the means by which C may have control of the cryptoasset include— (a) holding or storing of the means of access, or part of the means of access, to the cryptoasset; (b) appointing a person to hold or store the means of access, or part of the means of access, to the cryptoasset under an arrangement operated by C. (5) For the purposes of this article— (a) “consumer” means an individual who is acting for a purpose other than for any trade, business or profession carried on by that individual; (b) “relevant specified investment cryptoasset” means a specified investment cryptoasset that is a— (i) security, or (ii) contractually based investment; (c) “title transfer cryptoasset collateral arrangement” means an agreement or arrangement between C and the person who would otherwise be regarded as safeguarding the cryptoasset on behalf of another person (“A”), where— (i) the purpose of the agreement or arrangement with A is to secure or otherwise guarantee financial obligations owed by A to C, and (ii) A transfers legal and beneficial ownership of the cryptoasset to C on terms that C must transfer legal and beneficial ownership of the cryptoasset or its equivalent to A when the financial obligations referred to in paragraph (i) are discharged; (d) references to the cryptoasset, a qualifying cryptoasset or a relevant specified investment cryptoasset include the means of access to that cryptoasset; (e) references to the “means of access” to a cryptoasset include a private cryptographic key to that cryptoasset. (9O) (1) There are excluded from article 9N(1)(a) activities which a person (“P”) carries on pursuant to arrangements— (a) which are operated by an authorised cryptoasset custodian (“C”), who is connected with P, in the course of carrying on the activity in article 9N(1)(a), and (b) under which C undertakes to the person on whose behalf the qualifying cryptoasset or relevant specified investment cryptoasset is being safeguarded a responsibility in respect of that cryptoasset which is no less onerous than C would have undertaken if C were safeguarding the cryptoasset. (2) For the purposes of paragraph (1), an authorised cryptoasset custodian is connected with a person if they are a member of the same group as that person. (9P) (1) There are excluded from article 9N(1)(b) arrangements pursuant to which introductions are made by a person (“P”) to an authorised cryptoasset custodian (“C”), with a view to C providing in the United Kingdom a service comprising an activity of the kind specified by article 9N(1)(a), provided that— (a) C is not connected with P, and (b) P is not remunerated by C. (2) For the purposes of paragraph (1), an authorised cryptoasset custodian is connected with a person if they are a member of the same group as that person. (9Q) There are excluded from article 9N(1) arrangements whereby a qualifying cryptoasset or a relevant specified investment cryptoasset is held temporarily to facilitate the settlement of a transaction. (9R) (1) A person (“P”) does not carry on the activity specified by article 9N(1)(a) on behalf of another person (“A”), if A appoints P as their agent for the purposes of giving instructions to a third person (“C”), where C has undertaken directly to A to safeguard that cryptoasset. (2) A person (“P”) does not carry on the activity specified by article 9N(1)(a) on behalf of another person (“A”) unless P holds itself out as engaging in the business of providing a service in relation to a qualifying cryptoasset or a relevant specified investment cryptoasset to A, or to a person acting on behalf of A. (3) There is excluded from article 9N(1) any activity where the qualifying cryptoasset in question is, or is to be, safeguarded by a person (“A”), or a member of the same group as A, for the purpose of enabling or facilitating transactions by A, or a member of the same group as A, that would be within article 9T (dealing in qualifying cryptoassets as principal) but for the operation of article 9V(1)(e). (9S) The operation of a qualifying cryptoasset trading platform is a specified kind of activity. (9T) Buying, selling, subscribing for or underwriting a qualifying cryptoasset as principal is a specified kind of activity. (9U) (1) Subject to paragraph (3), a person (“P”) does not carry on an activity specified by article 9T by entering into a transaction which relates to a qualifying cryptoasset unless— (a) P holds itself out as willing, as principal, to buy, sell, subscribe for or underwrite qualifying cryptoassets of the kind to which the transaction relates at prices determined by P— (i) generally, and (ii) continuously rather than in respect of each particular transaction, (b) P holds itself out as engaging in the business of buying qualifying cryptoassets of the kind to which the transaction relates, with a view to selling them, (c) P holds itself out as engaging in the business of underwriting qualifying cryptoassets of the kind to which the transaction relates, or (d) P regularly solicits members of the public with the purpose of inducing them, as principals or agents, to enter into transactions constituting activities of the kind specified by article 9T, and the transaction is entered into as a result of P having solicited members of the public in that manner. (2) In paragraph (1)(d), “members of the public” means persons other than— (a) an authorised person with a Part 4A permission to carry on a regulated activity specified by article 9T; (b) a member of the same group as P. (3) Paragraph (1) does not apply where P enters into the transaction as bare trustee or, in Scotland, as nominee for another person (“B”), where— (a) P is acting on B’s instructions, and (b) P holds itself out as providing a service of buying and selling qualifying cryptoassets. (9V) (1) There are excluded from article 9T— (a) the creation, including the design, of a qualifying stablecoin; (b) the minting of a qualifying stablecoin, such that it first exists as— (i) an identifiable asset on a blockchain, and (ii) in a transferable form; (c) activity where the qualifying cryptoasset is acquired or transferred for no consideration; (d) the distribution of a qualifying cryptoasset that was automatically created as a reward for the maintenance of the distributed ledger or the validation of transactions; (e) activity where the qualifying cryptoasset is— (i) issued by, or on behalf of, the person carrying on the activity, and (ii) sold to or subscribed for by an employee or partner of the person carrying on the activity; (f) the private sale or transfer by a person (“A”) of a qualifying cryptoasset— (i) created and minted by, or on behalf of, A, and (ii) having as its sole purpose the raising of capital by A; (g) any activity by a person who only enters into transactions as principal with other members of the same group. (2) There is excluded from article 9T any activity specified by— (a) article 9M (issuing qualifying stablecoin); (b) article 9S (operating a qualifying cryptoasset trading platform); (c) article 9Z6 (qualifying cryptoasset staking). (9W) Buying, selling, or subscribing for or underwriting a qualifying cryptoasset as agent is a specified kind of activity. (9X) (1) There is excluded from article 9W— (a) the creation, including the design, of a qualifying stablecoin; (b) the minting of a qualifying stablecoin, such that it first exists as— (i) an identifiable asset on a blockchain, and (ii) in a transferable form; (c) activity where the qualifying cryptoasset is acquired or transferred for no consideration; (d) the distribution of a qualifying cryptoasset that was automatically created as a reward for the maintenance of the distributed ledger or the validation of transactions; (e) activity where the qualifying cryptoasset is— (i) issued by, or on behalf of, the person carrying on the activity, and (ii) sold to or subscribed for by an employee or partner of the person carrying on the activity. (2) There is excluded from article 9W activity specified by— (a) article 9M (issuing qualifying stablecoin); (b) article 9S (operating a qualifying cryptoasset trading platform); (c) article 9Z6 (qualifying cryptoasset staking). (9Y) (1) Making arrangements for another person,whether as principal or agent, to buy, sell, subscribe for or underwrite a qualifying cryptoasset is a specified kind of activity. (2) Making arrangements with a view to a person who participates in the arrangements for the buying, selling, subscribing for or underwriting a qualifying cryptoasset, whether as principal or agent, is also a specified kind of activity. (9Z) There are excluded from article 9Y(1) arrangements which do not, or would not, bring about the transaction to which the arrangements relate. (9Z1) There are excluded from article 9Y(2) arrangements where they are solely arrangements under which a person will be introduced to an authorised person with a Part 4A permission to carry on the regulated activity specified by this Chapter. (9Z2) A person does not carry on an activity specified by article 9Y(2) merely by providing means by which one party to a transaction, or potential transaction, is able to communicate with other such parties. (9Z3) (1) There are excluded from article 9Y(1) arrangements for a transaction into which the person making the arrangements enters or is to enter as principal or agent for another person. (2) There are excluded from article 9Y(2) arrangements which a person (“A”) makes with a view to transactions into which A enters or is to enter as principal or agent for another person. (9Z4) (1) There are excluded from article 9Y arrangements made by a person (“A”) acting as trustee or personal representative for, or with a view to a transaction which is, or is to be, entered into by— (a) A and a fellow trustee or personal representative, acting in their capacity as such, or (b) a beneficiary under the trust, will or intestacy. (2) Paragraph (1) does not apply where A is remunerated for what A does in addition to any remuneration A receives as trustee or personal representative, and for these purposes A is not to be regarded as receiving additional remuneration merely because A’s remuneration is calculated by reference to time spent. (9Z5) (1) There is excluded from article 9Y the following activities— (a) the creation, including the design, of a qualifying stablecoin; (b) the minting of a qualifying stablecoin, such that it first exists as— (i) an identifiable asset on the blockchain, and (ii) in a transferable form; (c) activity where the qualifying cryptoasset is acquired or transferred for no consideration; (d) the distribution of a qualifying cryptoasset that was automatically created as a reward for the maintenance of the distributed ledger or the validation of transactions; (e) activity where the qualifying cryptoasset is— (i) issued by, or on behalf of, the person carrying on the activity, and (ii) sold to or subscribed for by an employee or partner of the person carrying on the activity; (f) any activity where— (i) a person (“A”) who only makes arrangements for, or with a view to, a transaction which is or is to be entered into, as principal, by another member of the same group, and (ii) A is not authorised or required to be authorised to carry on an activity specified by this Chapter. (2) There is excluded from article 9Y activity specified by— (a) article 9M (issuing qualifying stablecoin); (b) article 9S (operating a qualifying cryptoasset trading platform); (c) article 9Z6 (qualifying cryptoasset staking). (9Z6) (1) Making arrangements on behalf of another person (whether as principal or agent) for qualifying cryptoasset staking is a specified kind of activity. (2) In this article— - “blockchain validation” means the validation of transactions on— a blockchain, or a network that uses distributed ledger technology or other similar technology, and includes proof of stake distributed ledger technology consensus mechanisms; - “qualifying cryptoasset staking” means the use of a qualifying cryptoasset in blockchain validation. (9Z7) There is excluded from article 9Z6 the provision of services solely for the purpose of introducing a person to an authorised person with a Part 4A permission to carry on the regulated activity specified by article 9Z6. (9Z8) A person does not carry on the activity specified by article 9Z6 merely by providing means by which one party to an arrangement, or potential arrangement, is able to communicate with other such parties. (9Z9) There is excluded from article 9Z6 a technical service provided by a person (a “P”) where— (a) the service allows another person to participate in qualifying cryptoasset staking, as defined by article 9Z6, including by the operation of a validator node for that staking, and (b) P does not hold itself out as offering qualifying cryptoasset staking to the public. (9Z10) (1) There is excluded from this Chapter an activity carried on for the purpose of the sale of goods or supply of services, by a supplier to a customer. (2) Paragraph (1) does not apply to article 9N (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets) so far as that article applies to relevant specified investment cryptoassets. (3) There is also excluded from the following articles activity for the purpose of a related sale of goods or supply of services— (a) article 9T (dealing in qualifying cryptoassets as principal); (b) article 9W (dealing in qualifying cryptoassets as agent); (c) article 9Y (arranging deals in qualifying cryptoassets). (4) In this article— - “customer” means a person to whom a supplier sells goods or supplies services, or agrees to do so, and, where the customer is a member of a group, also means any other member of that group; - “related sale of goods or supply of services” means a sale of goods or supply of services to the customer otherwise than by the supplier, but for the purpose of the sale or supply mentioned in paragraph (1); - “supplier” means— a person whose main business is to sell goods or supply services, and where the supplier is a member of a group, includes any other member of that group; - “supply of services” does not include the provision of a service comprising an activity of a kind specified by any provision of this Chapter. (9Z11) (1) There is excluded from this Chapter activity where that activity (“the incidental activity”)— (a) is carried on in a manner that is incidental to the carrying on of a profession or business, and (b) does not itself constitute the carrying on of a regulated activity. (2) For the purposes of paragraph (1)(a), an activity is carried on in a manner that is incidental to the carrying on of a profession or business where the following apply— (a) a close factual connection exists between the carrying on of the profession or business and the incidental activity, such that the incidental activity may reasonably be regarded as a necessary ancillary to the carrying on of the profession or business, (b) the incidental activity does not provide a systematic source of income to the person providing the professional activity, (c) the person carrying on the professional activity does not market or otherwise promote their ability to provide the incidental activity, except where there are disclosed to clients as being a necessary ancillary to the carrying on of the profession or business, and (d) the carrying on of a profession or business is supervised and regulated by any of the bodies listed in article 2 of the Financial Services and Markets Act 2000 (Designated Professional Bodies) Order 2001²⁷.

• (6) In article 40 (safeguarding and administering investments), after paragraph (3) insert—

(4) For the purposes of this article, references to “assets” do not include— (a) qualifying cryptoassets, or (b) relevant specified investment cryptoassets.

• (7) In article 42A (depositaries of UK UCITs and AIFs)²⁸, for “article 40” substitute “article 9N or 40”.

• (8) In article 64 (agreeing to carry on specified kinds of activity)²⁹, after “9B,” insert “9M, 9S,”.

• (9) In article 71 (activities carried on in connection with employee share schemes), after paragraph (5) insert—

(5A) There is excluded from article 9N any activity if the relevant specified investment cryptoassets in question are, or are to be, safeguarded by C, a member of the same group as C or a relevant trustee for the purpose of enabling or facilitating transactions of the kind described in paragraph (1).

• (10) In article 72H (insolvency practitioners)³⁰, in paragraph (2), before sub-paragraph (a) insert—

(za) any regulated activity specified by Chapter 2B (cryptoassets);

• (11) After article 88E (consumer hire agreement)³¹ insert—

(88F) (1) A qualifying cryptoasset. (2) A “qualifying cryptoasset” means a cryptoasset which is— (a) fungible, (b) transferable, (c) not solely a record of value or contractual rights, including rights in another cryptoasset, and (d) not excluded by paragraph (4). (3) For the purposes of paragraph (2)(b), the circumstances in which a cryptoasset is to be treated as “transferable” include where it confers transferable rights. (4) A cryptoasset does not fall within paragraph (1) if it is— (a) a specified investment cryptoasset, other than one specified by— (i) article 74A (electronic money)³²; and (ii) article 88F (qualifying cryptoassets); (b) electronic money; (c) currency of the United Kingdom or any other country or territory, including a central bank digital currency; (d) a cryptoasset that— (i) cannot be transferred or sold in exchange for money or other cryptoassets, except by way of redemption with the issuer, and (ii) can only be used by the holder— (aa) to acquire goods or services from the issuer, or (bb) to acquire goods or services within a limited network of service providers which have direct commercial agreements with the issuer. (88G) (1) A qualifying stablecoin. (2) A “qualifying stablecoin” means a qualifying cryptoasset where— (a) that cryptoasset seeks or purports to maintain a stable value in relation to a particular fiat currency (“the referenced fiat currency”), and (b) fiat currency (which may be referenced fiat currency referred to in sub-paragraph (a)) or other assets are held for the purpose of maintaining a stable value, in accordance with sub-paragraph (a). (3) Where a cryptoasset seeks or purports to maintain a stable value in relation to an asset other than a fiat currency, the cryptoasset is not to be regarded as falling within paragraph (2)(a) even if the asset is expressed in terms of a fiat currency. (4) For the purposes of paragraph (2)(b)— (a) other assets do not include the cryptoasset itself; (b) the holding of fiat currency or another asset for the purpose of maintaining a stable value does not include the holding of assets by a person carrying on the activity described in article 5 (accepting deposits), whether authorised or not, for the purpose of complying with its general prudential requirements or meeting its liabilities generally. (5) In this article, “fiat currency” means the currency of the United Kingdom or any other country or territory, unless that currency is solely a cryptoasset.

• (12) After article 97 (disapplication of section 49(2) of the Act)³³ insert—

(98) (1) For the purposes of the FCA making rules in relation to the activity specified by article 9M (issuing qualifying stablecoin), section 137B of the Act (FCA general rules: clients’ money, right to rescind etc)³⁴ applies as if references to “clients’ money” and “money” include a sum or asset received or held as a backing asset for the purposes of a qualifying stablecoin. (2) For the purposes of paragraph (1), a “sum or asset received or held as a backing asset” includes where the sum or asset received or held is categorised as, is to be treated as or should be held as a backing asset under rules made by the FCA in relation to the regulated activity specified by article 9M. (99) For the purposes of the FCA making rules in relation to an activity specified by article 9N (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets) so far as it concerns qualifying cryptoassets, section 137B of the Act (FCA general rules: clients’ money, right to rescind etc) applies as if— (a) references to “clients’ money” and “money” include a qualifying cryptoasset or any other asset; (b) references to “accounts” are read as including a reference to wallets or any other form of storing or recording a qualifying cryptoasset.

Part 4 — Amendment of the Act

Amendment of the Act

41

• (1) The Act is amended as follows.

• (2) In section 131AB (interpretation)³⁵—

• (a) in subsection (1)—

• (i) for the definition of “financial instrument” substitute—

• “financial instrument” means any of the following— an instrument specified in Part 1 of Schedule 2 to the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, read with Part 2 of that Schedule; a “qualifying cryptoasset” as defined by article 88F of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; a “related instrument” as defined by regulation 17(1) of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026;

• (ii) for the definition of “issuer” substitute—

• “issuer” means— an issuer defined by Article 3.1(21) of the market abuse regulation³⁶, or a “relevant person” as defined by regulation 17(4) of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026; and

• (b) in subsection (2)—

• (i) at the end of paragraph (a), omit “and”;

• (ii) in paragraph (b), for “day.” substitute “day; and”;

• (iii) after paragraph (b), insert—

(c) Chapter 2 of Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (3) In section 176 (entry of premises under warrant)³⁷, in subsection (11)—

• (a) at the end of paragraph (aa) omit “or”;

• (b) before paragraph (b) insert—

(ab) by the FCA by virtue of regulation 21 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026; or

• (4) In section 285 (exemption for recognised bodies etc.), after subsection (2)³⁸ insert—

(2A) Subsection (2) does not apply in respect of a regulated activity specified by Chapter 2B (cryptoassets) of Part 2 (specified activities) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001.

• (5) In section 384(7) (power of FCA or PRA to require restitution)³⁹—

• (a) at the end of paragraph (c) omit “or”;

• (b) at the end of paragraph (d), for “that Part.” substitute “that Part; or”;

• (c) after paragraph (d) insert—

(e) a requirement imposed by or under Chapter 2 of Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (6) In section 418 (carrying on regulated activities in the United Kingdom), after subsection (6) insert—

(6B) The ninth case is where— (a) the regulated activity being carried on by the person (“A”) is that specified by article 9M of the Regulated Activities Order (issuing qualifying stablecoin), and (b) all of the activities specified in the conditions set out in paragraph (2)(a) to (c) of that article are carried on by A, or on behalf of A, in the United Kingdom. (6C) The tenth case is where— (a) the regulated activity being carried on by the person (“A”) is a regulated cryptoasset activity, (b) A is involved in the sale or subscription of a qualifying cryptoasset to, or by, a consumer (“C”), and (c) there is no person who— (i) is authorised under Part 4A of this Act to carry on a regulated cryptoasset activity of a kind referred to in subsection (6D)(a) or (b), (ii) is carrying on that activity in relation to the sale or subscription mentioned in paragraph (b), and (iii) in doing so, is acting as an intermediary between A and C. (6D) In subsection (6C), a “regulated cryptoasset activity” means a regulated activity specified by the following articles of the Regulated Activities Order— (a) article 9S (operating a qualifying cryptoasset trading platform); (b) article 9T (dealing in qualifying cryptoassets as principal); (c) article 9W (dealing in qualifying cryptoassets as agent); (d) article 9Y (arranging deals in qualifying cryptoassets). (6E) The eleventh case is where— (a) the regulated activity being carried on by the person (“A”) is specified by— (i) article 9N (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets) of the Regulated Activities Order, or (ii) article 9Z6 (qualifying cryptoasset staking) of the Regulated Activities Order, (b) A is carrying on that activity on behalf of a consumer, and (c) A is not carrying on that activity at the direction of another person who is authorised under Part 4A of this Act to carry on that regulated activity. (6F) In subsections (6B) to (6E)— (a) “consumer” means an individual in the United Kingdom who is acting for a purpose other than for any trade, business or profession carried on by that individual; (b) “Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; (c) where a term that is used is also used in Chapter 2B (cryptoassets) of Part 2 (specified activities) of the Regulated Activities Order, then it has the same meaning as that given in that Chapter.

• (7) In Schedule 6C (listed designated activity regulations and requirements for the purposes of certain provisions)⁴⁰—

• (a) in Part 1 (provisions designating relevant designated activities), at the end insert—

Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (b) in Part 2 (relevant Part 5A requirements for the purposes of specified provisions)—

• (i) in the table, in the entry relating to Part 11 of the Act, in the second column, at the end insert—

(3) Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (ii) in the table, in the entry relating to Part 14 of the Act, in the second column, at the end insert—

(3) Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (c) in Part 3 (relevant Part 5A directions for the purposes of Chapter 2 of Part 5A), in the table, after the final row insert a new row—

Part 2 of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

Part 5 — Amendment of the Financial Promotion Order

Amendment of the Financial Promotion Order

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• (1) The Financial Promotion Order⁴¹ is amended as follows.

• (2) In article 2 (interpretation: general)⁴², for the definition of “qualifying cryptoasset” substitute—

• “qualifying cryptoasset” has the meaning given by article 88F of the Regulated Activities Order (qualifying cryptoassets), except that the condition as to the cryptoasset being transferable or conferring transferable rights is to be taken as met if a communication made in relation to the cryptoasset describes it as being transferable or conferring transferable rights;
• “qualifying stablecoin” has the meaning given by article 88G of the Regulated Activities Order (qualifying stablecoin);

• (3) In article 70 (promotions included in listing particulars etc.)⁴³, after paragraph 1(d) insert—

(e) a qualifying cryptoasset disclosure document or a supplementary disclosure document as defined by regulation 6 (“qualifying cryptoasset disclosure document” and “supplementary disclosure document”) of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026.

• (4) Omit article 73ZA (certain promotions of qualifying cryptoassets).

• (5) In Schedule 1—

• (a) in Part 1 (controlled activities)—

• (i) in paragraph 4 (arranging deals in investments), after sub-paragraph (3) insert—

(4) This paragraph does not apply to the activity specified by paragraph 7C (qualifying cryptoasset staking)⁴⁴.

• (ii) in paragraph 6 (safeguarding and administering investments), after sub-paragraph (4) insert—

(5) This paragraph does not apply to an activity specified by paragraph 7A (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets).

• (iii) after paragraph 7 (advising on investments) insert—

(7A) (1) The following are controlled activities— (a) the safeguarding of a qualifying cryptoasset or a relevant specified investment cryptoasset (“the cryptoasset”) on behalf of another person (“A”); (b) arranging for a person to carry on that activity. (2) For the purposes of sub-paragraph (1)(a)— (a) a person (“C”) is to be regarded as safeguarding the cryptoasset if C has control of the cryptoasset through any means that would enable C to bring about a transfer of the benefit of the cryptoasset to another person, including to C; (b) “on behalf of another” includes where that other person, A, has— (i) both legal and beneficial title to the cryptoasset; (ii) the beneficial title only to the cryptoasset; (iii) subject to sub-paragraph (c), a right against C for the return of the cryptoasset; (c) subject to paragraph (d), paragraph (b)(iii) does not apply where A’s right against C for the cryptoasset arises in the following circumstances— (i) C received the cryptoasset from A under a title transfer cryptoasset collateral arrangement, or (ii) C acquired the cryptoasset from A under an agreement pursuant to which A contracted to buy back the cryptoasset from C; (d) paragraph (c) does not apply where A is— (i) a consumer, or (ii) specified, or of a description specified, in rules made by the FCA. (3) Rules made by virtue of sub-paragraph (2)(d)(ii) may— (a) specify a particular person or class of persons; (b) be limited so as to apply only to agreements or arrangements, or classes of agreements or arrangements, specified by the rules. (4) For the purposes of sub-paragraph (2)(a), the means by which C may have control of the cryptoasset include— (a) holding or storing of the means of access, or part of the means of access, to the cryptoasset; (b) appointing a person to hold or store the means of access, or part of the means of access, to the cryptoasset under an arrangement operated by C. (5) There are excluded from sub-paragraph (1)(a) activities which a person (“P”) carries on pursuant to arrangements— (a) which are operated by an authorised cryptoasset custodian (“C”), who is connected with P, in the course of carrying on the activity in sub-paragraph (1)(a), and (b) under which C undertakes to the person on whose behalf the cryptoasset is being safeguarded a responsibility in respect of that cryptoasset which is no less onerous than C would have undertaken if C were safeguarding the cryptoasset. (6) There are excluded from sub-paragraph (1)(b) arrangements pursuant to which introductions are made by a person (“P”) to an authorised cryptoasset custodian (“C”), with a view to C providing in the United Kingdom a service comprising an activity of the kind specified by sub-paragraph (1)(a), provided that— (a) C is not connected with P, and (b) P is not remunerated by C. (7) There are excluded from sub-paragraph (1) arrangements whereby a qualifying cryptoasset or a relevant specified investment cryptoasset is held temporarily to facilitate the settlement of a transaction. (8) A person (“P”) does not carry on the activity specified by sub-paragraph (1)(a) on behalf of another person (“A”), if A appoints P as their agent for the purposes of giving instructions to a third person (“C”), where C has undertaken directly to A the responsibility to safeguard the cryptoasset. (9) A person (“P”) does not carry on the activity specified by sub-paragraph (1)(a) on behalf of another person (“A”) unless P holds itself out as engaging in the business of providing a service in relation to the cryptoasset to A, or to a person acting on behalf of A. (10) There is excluded from sub-paragraph (1) any activity where the cryptoasset is, or is to be, safeguarded by a person (“A”), or a member of the same group as A, for the purpose of enabling or facilitating transactions by A, or a member of the same group as A, that would be within article 9T (dealing in qualifying cryptoassets as principal) of the Regulated Activities Order but for the operation of article 9V(2)(c). (11) For the purposes of this paragraph— (a) “authorised cryptoasset custodian” means an authorised person who has a Part 4A permission to carry on the regulated activity specified by article 9N(1)(a) (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets); (b) “consumer” means an individual who is acting for a purpose other than for any trade, business or profession carried on by that individual; (c) “relevant specified investment cryptoasset” has the meaning given by article 9N(5)(b) of the Regulated Activities Order (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets); (d) “title transfer cryptoasset collateral arrangement” means an agreement or arrangement between C and the person who would otherwise be regarded as safeguarding the cryptoasset on behalf of another person (“A”), where— (i) the purpose of the agreement or arrangement with A is to secure or otherwise guarantee financial obligations owed by A to C, and (ii) A transfers legal and beneficial ownership of the cryptoasset to C on terms that C must transfer legal and beneficial ownership of the cryptoasset, or its equivalent, to A when the financial obligations referred to in sub-paragraph (i) are discharged; (e) references to a cryptoasset, qualifying cryptoasset or a relevant specified investment cryptoasset include the means of access to that cryptoasset; (f) references to the “means of access” to a cryptoasset include a private cryptographic key to that cryptoasset; (g) an authorised cryptoasset custodian is connected with a person if they are a member of the same group as that person. (7B) (1) The operation of a qualifying cryptoasset trading platform is a controlled activity. (2) In this paragraph, “qualifying cryptoasset trading platform” has the meaning given by article 3 (interpretation) of the Regulated Activities Order. (7C) (1) Making arrangements on behalf of another person (whether as principal or agent) for qualifying cryptoasset staking is a controlled activity. (2) There is excluded from sub-paragraph (1) the provision of services solely for the purpose of introducing a person to an authorised person with a Part 4A permission to carry on the regulated activity specified by article 9Z6. (3) A person does not carry on the activity specified by sub-paragraph (1) merely by providing means by which one party to an arrangement, or potential arrangement, is able to communicate with other such parties. (4) There is excluded from sub-paragraph (1) a technical service provided by a person (“P”) where— (a) the service allows another person to participate in qualifying cryptoasset staking, as defined by article 9Z6, including by the operation of a validator node for that staking, and (b) P does not hold itself out as offering qualifying cryptoasset staking to the public. (5) In this paragraph— - “blockchain validation” means the validation of transactions on— a blockchain, or a network that uses distributed ledger technology or other similar technology, and includes proof of stake distributed ledger technology consensus mechanisms; - “qualifying cryptoasset staking” means the use of a qualifying cryptoasset in blockchain validation.

• (b) in Part 2 (controlled investments), for paragraph 26F (qualifying cryptoasset)⁴⁵ substitute—

(26F) Qualifying cryptoassets.

Part 6 — Consequential amendment of other secondary legislation

Amendment of the Financial Services and Markets Act 2000 (Collective Investment Schemes) Order 2001

43

• (1) The Financial Services and Markets Act 2000 (Collective Investment Schemes) Order 2001⁴⁶ is amended as follows.

• (2) In the Schedule (arrangements not amounting to a collective investment scheme)—

• (a) after paragraph 3 (pure deposit based schemes) insert—

(3A) (1) Arrangements do not amount to a collective investment scheme where— (a) they are arrangements under which money or an asset is held for the stabilisation of a qualifying stablecoin, and (b) both the conditions in paragraph (2)(a) and (b) are met. (2) The conditions referred to in paragraph (1)(b) are— (a) that the issuer of the qualifying stablecoin does not pay, or arrange for another to pay, interest or yield arising from money or an asset held for the stabilisation of the qualifying stablecoin, or the benefits accruing from such to a holder; (b) that, under normal conditions, the qualifying stablecoin offers a holder a right to redeem the stablecoin with the issuer at the same value, in the currency the stablecoin referenced at issue (excluding any fees that may be payable on redemption). (3) For the purposes of this regulation— (a) “qualifying stablecoin” has the meaning given by article 88G of the Regulated Activities Order (qualifying stablecoin); (b) money or an asset is held for the stabilisation of a qualifying stablecoin if it is held for the purpose mentioned in article 88G(2)(b) of the Regulated Activities Order.

• (b) In paragraph 22 (qualifying cryptoasset staking)⁴⁷, in sub-paragraph (2), for the definition of “qualifying cryptoasset” substitute—

• “qualifying cryptoasset” has the meaning given by article 88F of the Regulated Activities Order (qualifying cryptoassets);

Amendment of the Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001

44

• (1) The Financial Services and Markets Act 2000 (Carrying on Regulated Activities by Way of Business) Order 2001⁴⁸ is amended as follows.

• (2) In article 3 (investment business), in paragraph (2), before sub-paragraph (a) insert—

(za) article 9M (issuing qualifying stablecoin); (zb) article 9N (safeguarding of qualifying cryptoassets and relevant specified investment cryptoassets); (zc) article 9S (operating a qualifying cryptoasset trading platform); (zd) article 9T (dealing in qualifying cryptoassets as principal); (ze) article 9W (dealing in qualifying cryptoassets as agent); (zf) article 9Y (arranging deals in qualifying cryptoassets); (zg) article 9Z6 (qualifying cryptoasset staking);

Amendment of the Financial Services and Markets Act 2000 (Professions) (Non-Exempt Activities) Order 2001

45

• (1) The Financial Services and Markets Act 2000 (Professions) (Non-Exempt Activities) Order 2001⁴⁹ are amended as follows.

• (2) In article 4 (activities to which exemption from the general prohibition does not apply)⁵⁰, after paragraph (aa) insert—

(ab) article 9M (issuing qualifying stablecoin); (ac) article 9T (dealing in qualifying cryptoassets as principal); (ad) article 9Z6 (qualifying cryptoasset staking);

Amendment of the Electronic Money Regulations 2011

46

• (1) The Electronic Money Regulations 2011⁵¹ are amended as follows.

• (2) In regulation 2 (interpretation), in the definition of “electronic money”, at the end of paragraph (c) insert “or 3ZA”.

• (3) After regulation 3 (electronic money: exclusions) insert—

(3ZA) (1) For the purposes of the definition of “electronic money” in regulation 2 (interpretation), “monetary value” does not include— (a) a stablecoin; (b) money or an asset held for the stabilisation or backing of a stablecoin. (2) Nothing in this regulation affects whether electronic money held for the stabilisation or backing of a stablecoin is considered electronic money, as defined by regulation 2 (interpretation). (3) In this regulation, “stablecoin” means a cryptoasset that— (a) meets the following two conditions— (i) it seeks or purports to maintain a stable value in relation to a particular fiat currency (“the referenced fiat currency”), and (ii) fiat currency (which may be that referenced fiat currency) or other assets are held for the purpose of maintaining its stable value in relation to the referenced fiat currency, in accordance with paragraph (i), (b) is fungible, (c) is transferable, (d) is not solely a record of value or contractual rights, including another cryptoasset, and (e) is not excluded by paragraph (6). (4) Where a cryptoasset seeks or purports to maintain a stable value in relation to an asset other than a fiat currency, the cryptoasset is not to be regarded as falling within paragraph (3)(a)(i) even if the asset is expressed in terms of a fiat currency. (5) For the purposes of paragraph (3)(a)(ii)— (a) other assets do not include the cryptoasset itself; (b) the holding of fiat currency or another asset for the purpose of maintaining a stable value does not include the holding of assets by a person carrying on the activity described in article 5 of the Regulated Activities Order (accepting deposits), whether authorised or not, for the purpose of complying with its general prudential requirements or meeting its liabilities generally. (6) The following are excluded from being a stablecoin— (a) a specified investment cryptoasset, other than one specified by the following articles of the Regulated Activities Order— (i) article 74A (electronic money)⁵²; (ii) article 88F (qualifying cryptoassets); (b) electronic money; (c) currency of the United Kingdom or any other country or territory, including a central bank digital currency; (d) a cryptoasset that— (i) cannot be transferred or sold in exchange for money or other cryptoassets, except by way of redemption with the issuer, and (ii) can only be used by the holder— (aa) to acquire goods or services from the issuer, or (bb) to acquire goods or services within a limited network of service providers, which have direct commercial agreements with the issuer. (7) For the purposes of paragraphs (1)(b) and (2), money or an asset is held for the stabilisation of a stablecoin if it is held for the purpose mentioned in paragraph (3)(a)(ii). (8) For the purposes of paragraph (3)(c), the circumstances in which a cryptoasset is to be treated as “transferable” include where it confers transferable rights. (9) In this regulation— - “cryptoasset” has the meaning given by section 417(1) (definitions) of the 2000 Act; - “fiat currency” means the currency of the United Kingdom or any other country or territory, unless that currency is solely a cryptoasset; - “money” includes electronic money; - “Regulated Activities Order” means the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001; - “specified investment cryptoasset” has the meaning given by article 3 (interpretation) of the Regulated Activities Order.

Amendment of the Alternative Investment Fund Managers Regulations 2013

47

• (1) The Alternative Investment Fund Managers Regulations 2013⁵³ are amended as follows.

• (2) After regulation 3 (meaning of “AIF”) insert—

(3A) (1) Arrangements do not constitute an AIF where— (a) they are arrangements under which money or an asset is held for the stabilisation of a qualifying stablecoin, and (b) both the conditions in paragraph (2)(a) and (b) are met. (2) The conditions referred to in paragraph (1)(b) are— (a) that the issuer of the qualifying stablecoin does not pay, or arrange for another to pay, interest or yield arising from money or an asset held for the stabilisation of the qualifying stablecoin, or the benefits accruing from such to a holder; (b) that under normal conditions, the qualifying stablecoin offers a holder a right to redeem the stablecoin with the issuer at the same value, in the currency the stablecoin referenced at issue (excluding any fees that may be payable on redemption). (3) For the purposes of this regulation— (a) “qualifying stablecoin” has the meaning given by article 88G of the Regulated Activities Order (qualifying stablecoin); (b) money or an asset is held for the stabilisation of a qualifying stablecoin if it is held for the purpose mentioned in article 88G(2)(b) of the Regulated Activities Order.

Amendment of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017

48

• (1) The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017⁵⁴ are amended as follows.

• (2) In regulation 3 (general interpretation), in paragraph (1), at the appropriate places insert—

• “authorised cryptoasset firm” means an authorised person who is authorised to carry on a regulated activity specified by Chapter 2B (cryptoassets) of Part 2 (specified activities) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;
• “regulated activity” has the meaning given by section 22 of FSMA (regulated activities);
• “specified investment cryptoasset” has the meaning given by article 3 of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (interpretation);
• “specified investment cryptoasset firm” means an authorised person who— has permission under Part 4A of FSMA to carry on a regulated activity other than one specified by Chapter 2B (cryptoassets) of Part 2 (specified activities) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001, and carries on activity under that permission in relation to specified investment cryptoassets;

• (3) In regulation 54 (duty to maintain registers of certain relevant persons), for paragraph (1A)⁵⁵ substitute—

(1A) The FCA must maintain a register of those relevant persons who— (a) are— (i) cryptoasset exchange providers, or (ii) custodian wallet providers, but (b) are not— (i) authorised cryptoasset firms, or (ii) specified investment cryptoasset firms.

• (4) After regulation 56A (transitional provision for existing cryptoasset businesses: requirement to register)⁵⁶ insert—

(56B) (1) An authorised cryptoasset firm or specified investment cryptoasset firm must, before acting as a cryptoasset exchange provider or a custodian wallet provider or within 28 days of so doing, inform the FCA that it intends, or has begun, to act as such. (2) Paragraph (1) does not apply to an authorised cryptoasset firm or specified investment cryptoasset firm which— (a) immediately before the date specified by regulation 1(2) of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 (citation, commencement and extent) (“the full commencement day”) was acting as a cryptoasset exchange provider or custodian wallet provider and continues to act as such after that date, and (b) informs the FCA that it is acting as such within 30 days beginning with the full commencement day. (3) Where an authorised cryptoasset firm or specified investment cryptoasset firm ceases to act as a cryptoasset exchange provider or a custodian wallet provider, it must inform the FCA within 28 days beginning with the day of ceasing to act as such. (4) If, at any time after an authorised cryptoasset firm or specified investment cryptoasset firm (“A”) has provided the FCA with any information under this regulation— (a) there is a material change affecting any matter contained in that information, or (b) it becomes apparent to A that the information contains an inaccuracy, then A must provide the FCA with details of the change or a correction of the inaccuracy within 30 days beginning with the date of the change or the discovery of the inaccuracy. (5) Any information provided to the FCA under this regulation must be in such form and verified in such manner as the FCA may specify. (6) Any requirement imposed by this regulation is to be treated as if it were a requirement imposed by or under FSMA.

• (5) In regulation 77 (power to impose civil penalties: suspension and removal of authorisation) omit paragraph (3)(b).

• (6) In Schedule 6 (meaning of “relevant requirement”), after paragraph 10(a) insert—

(aa) regulation 56B (requirement that cryptoasset firms acting as cryptoasset exchange providers or custodian wallet providers inform the FCA);

Amendment of the Payment Services Regulations 2017

49

• (1) The Payment Services Regulations 2017⁵⁷ are amended as follows.

• (2) In Schedule 1 (payment services), in Part 2 (activities which do not constitute payment services), after paragraph 3 insert—

(4) The activity specified by article 9M of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 (issuing qualifying stablecoin) does not constitute a payment service.

Amendment of the Financial Services and Markets Act 2000 (Prudential Regulation of FCA Investment Firms) (Definitions for the purposes of Part 9C) Regulations 2021

50

• (1) The Financial Services and Markets Act 2000 (Prudential Regulation of FCA Investment Firms) (Definitions for the purposes of Part 9C) Regulations 2021⁵⁸ are amended as follows.

• (2) In regulation 2 (interpretation)—

• (a) in the definition of a “IFPR financial institution”, in paragraph (a), for “activities listed in points 2 to 12, point 15 and the final paragraph of the Annex 1 activities” substitute “relevant activities”;

• (b) after the definition of the “PRA Rulebook” insert—

• “relevant activities” means the activities— listed in points 2 to 12, point 15 and the final paragraph of the Annex 1 activities, or specified by Chapter 2B (cryptoassets) of Part 2 (specified activities) of the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001;

Part 7 — Savings and transitional provision

Chapter 1 — Interpretation and relevant application period

Interpretation

51

In this Part—

• “open to review” in relation to a relevant cryptoasset permission means— the application has been refused by the FCA by a decision notice given under section 55X(4) of the Act (determination of applications: warning notices and decision notices), and one of the following is the case— the period for making a reference to the Tribunal under section 55Z3 of the Act (right to refer matters to the Tribunal) is still running; the matter has been referred to the Tribunal but has not yet been dealt with; the matter has been referred to the Tribunal and dealt with but the period during which an appeal may be brought against the Tribunal's decision is still running; an appeal has been brought against the Tribunal but has not yet been determined;

• “overseas person” means a person who— carries on an activity that will be a relevant cryptoasset activity on the full commencement day, and does not carry on that relevant cryptoasset activity from an establishment in the United Kingdom;

• “pre-existing contract” has the meaning given by regulation 56(4) (temporary exemption relating to pre-existing contracts);

• “relevant application period” means the period set by the FCA in accordance with directions given under regulation 52 (relevant application period);

• “relevant cryptoasset activity” means an activity that, as a result of the amendments in regulation 40 of these Regulations (amendment of the Regulated Activities Order)— before the full commencement day, is to become a regulated activity on full commencement day, or on or after the full commencement, is a regulated activity;

• “relevant cryptoasset permission” means— a Part 4A permission to carry on a relevant cryptoasset activity, or the variation of an existing Part 4A permission to include a relevant cryptoasset activity;

• “the relevant day” has the meaning given by regulation 56(4) (temporary exemption relating to pre-existing contracts).

Relevant application period

52

• (1) Not later than 1 year before the full commencement day, the FCA must by direction specify an application period for the purposes of this Part (“relevant application period”).

• (2) A direction given under paragraph (1) must specify the first day and the last day of the relevant application period, where—

• (a) the relevant application period must have a duration of at least 28 days, and

• (b) the last day must be at least 28 days before the full commencement day.

• (3) The power in paragraph (1) includes the power to amend or replace any direction for the purpose of extending the relevant application period.

• (4) Directions given under paragraph (1) must be published in such manner as the FCA considers appropriate.

• (5) A direction under paragraph (1) does not prevent applications for a relevant cryptoasset permission being made outside the relevant application period.

Chapter 2 — Cryptoasset saving provision

Saving provision for decisions not fully determined

53

• (1) This regulation applies to a person (“P”) where—

• (a) P applied for a relevant cryptoasset permission during the relevant application period (“the application”), and

• (b) the application has either—

• (i) not been determined by the FCA, or

• (ii) been refused by the FCA but is open to review, and

• (c) P is not subject to a direction by the FCA made under regulation 55(3) (application of the cryptoasset transitional provision) applying that regulation and Chapter 3 (cryptoasset transitional provision) of this Part to them.

• (2) For the purposes of the relevant cryptoasset activity to which the application relates, P, and any overseas person in the same group as P, is to be treated as if Parts 3 to 6 of these Regulations had not come into force.

• (3) This Chapter ceases to have effect at the end of the period of 2 years beginning with the full commencement day.

Notification by a person to whom regulation 53 applies

54

• (1) As soon as reasonably practicable after the full commencement day, an overseas person to whom regulation 53 (saving provision for decisions not fully determined) applies (“O”) must notify the FCA that they are carrying on a relevant cryptoasset activity under that regulation.

• (2) If, before regulation 53 ceases to have effect, O—

• (a) ceases to carry on the relevant cryptoasset activity, and

• (b) no longer intends to carry on the relevant cryptoasset activity,

O must, as soon as reasonably practicable, notify the FCA that they no longer carry on and no longer intend to carry on the relevant cryptoasset activity.

Chapter 3 — Cryptoasset transitional provision

Application of the cryptoasset transitional provision

55

• (1) Regulation 56 applies to a person where the following conditions are satisfied—

• (a) during the relevant application period, that person applied for a relevant cryptoasset permission, and

• (b) that application—

• (i) has been refused by the FCA, and is no longer open to review, or

• (ii) has been withdrawn.

• (2) Regulation 56 also applies to a person where the following conditions are satisfied—

• (a) outside the relevant application period but before the full commencement day, that person applied for a relevant cryptoasset permission, and

• (b) that application—

• (i) has not been determined,

• (ii) has been refused, or

• (iii) has been withdrawn.

• (3) The FCA may direct that regulation 56, and not regulation 53, will apply to a person, where that person has—

• (a) applied for a relevant cryptoasset permission during the relevant application period, and

• (b) that application has been refused by the FCA but is open to review.

• (4) Regulation 56 applies to an overseas person (“O”) where—

• (a) a person (“P”), established in the United Kingdom, has made an application within the scope of paragraph (1), and

• (b) O is within the same group as P.

• (5) The FCA may only exercise the power in paragraph (3) if it considers that the exercise of the power is necessary—

• (a) for the prevention, detection, investigation, or prosecution of a criminal offence;

• (b) for the protection of consumers;

• (c) in order for the FCA to advance its objectives under Part 1A of the Act⁵⁹.

• (6) Where the FCA decides to exercise the power in paragraph (3), the FCA must—

• (a) specify the date on which the direction is to come into effect, which may not be before the full commencement day, and

• (b) give a decision notice to the person to whom the decision relates.

• (7) A person to whom a direction is given under paragraph (3) relates may refer the decision to exercise the power in that paragraph to the Tribunal.

• (8) Part 9 of the Act (hearings and appeals) applies to a reference to the Tribunal under paragraph (7) as it applies to a reference under that Act.

• (9) This Chapter ceases to have effect at the end of the period of 2 years beginning with the full commencement day.

Temporary exemption relating to pre-existing contracts

56

• (1) Subject to paragraph (2), a person to whom this regulation applies is an exempt person for the purposes of section 19(1)(b) of the Act (the general prohibition).

• (2) If a person to whom this regulation applies is already an authorised person, then they are to be treated as exempt from the application of section 20 of the Act (authorised persons acting without permission).

• (3) An exemption under this regulation has effect—

• (a) in relation to the carrying on of a relevant cryptoasset activity for which the person does not have a Part 4A permission,

• (b) solely to the extent—

• (i) necessary for the performance of a pre-existing contract, including where the performance of an obligation under the contract is contingent or conditional, and

• (ii) where carried on for the purposes of performing such a contract, and

• (c) subject to the operation of regulation 59 (variation and cancellation of an exemption under regulation 56).

• (4) In this regulation—

• “pre-existing contract” means a contract entered into before the relevant day;

• “the relevant day” means— where this regulation applies as a result of regulation 55(1), (2) or (4), whichever is the later of— the full commencement day, or if the day on which the condition in regulation 55(1), (2) or (4) (as applicable) is met is after the full commencement day, that day, or where this regulation applies as a result of regulation 55(3), the day on which the FCA specifies that the direction given under that provision takes effect.

Notification by a person to whom regulation 56 applies

57

• (1) A person to whom regulation 56 (temporary exemption relating to pre-existing contracts) applies (“A”) must, as soon as reasonably practicable after the relevant day, notify the FCA that they are carrying on a relevant cryptoasset activity to which the exemption applies under regulation 56.

• (2) If, before regulation 56 ceases to have effect, A—

• (a) ceases to carry on the relevant cryptoasset activity, and

• (b) no longer intends to carry on the relevant cryptoasset activity,

A must, as soon as reasonably practicable, notify the FCA that they no longer carry on and no longer intend to carry on the relevant cryptoasset activity.

• (3) Notifications under paragraphs (1) and (2) must be made in such manner and contain or be accompanied by such information as the FCA may require.

Information to be supplied to a party to a contract with a person to whom regulation 56 applies

58

• (1) A person to whom regulation 56 (temporary exemption relating to pre-existing contracts) applies (“A”) must notify each party to a pre-existing contract with A—

• (a) that A is an exempt person for the purposes of section 19(1)(b) and section 20 (as applicable) of the Act;

• (b) that A is not authorised by the FCA in relation to the carrying on of that activity.

• (2) Notifications under paragraph (1) must be made as soon as reasonably practicable after the relevant day.

• (3) A must notify each party to a pre-existing contract with A, if there is a material change in respect of—

• (a) the protection afforded to assets held by A in relation to the performance of the contract;

• (b) the mechanisms for resolving disputes in connection with the contract;

• (c) the schemes available for compensation in relation to the contract,

of that material change.

• (4) Notifications under paragraph (3) must be made as soon as reasonably practicable after the material change referred to in that paragraph came to the notice to A.

• (5) Notifications under paragraphs (1) and (3) must be made in such manner and contain or be accompanied by such information as the FCA may require.

Variation and cancellation of an exemption under regulation 56

59

• (1) The FCA may by notice given to a person to whom the exemption under regulation 56 (temporary exemption relating to pre-existing contracts) applies—

• (a) cancel the exemption or part of the exemption;

• (b) impose on that person such conditions relating to the exemption, or part of the exemption, as the FCA consider appropriate.

• (2) The power to impose conditions and remove regulated activities under paragraph (1)(b) and (c) includes the power to impose a final day for the application of—

• (a) the exemption under regulation 56, or part of it;

• (b) any condition imposed under paragraph (1)(b).

• (3) Any final day imposed under paragraph (2) must be before the end of the period specified by regulation 55(9).

• (4) The FCA may only exercise the power under paragraph (1) where—

• (a) it considers that the exercise of the power is necessary for the—

• (i) prevention, detection, investigation, or prosecution of a criminal offence;

• (ii) protection of consumers;

• (iii) FCA to advance its objectives under Part 1A of the Act, or

• (b) on or after the relevant day, the person to whom regulation 56 applies has ceased carrying on a regulated activity covered by the exemption.

• (5) In an urgent case, where the FCA decides to exercise the power under paragraph (1), it must give a decision notice to the person to whom the decision relates.

• (6) A notice under paragraph (4) must state when the decision takes effect, which may be immediately upon receipt.

• (7) In any case other than an urgent case—

• (a) where the FCA proposes to exercise the power under paragraph (1), it must give the person a warning notice;

• (b) where the FCA decides to exercise the power under paragraph (1), it must give the person a decision notice.

• (8) Part 26 of the Act (notices) applies to a notice under paragraphs (1) and (4) as it applies to a notice given under the Act.

• (9) A person in respect of whom the power under paragraph (1) is exercised may refer the decision to exercise the power to the Tribunal.

• (10) Part 9 of the Act (hearings and appeals) applies to a reference to the Tribunal under paragraph (9) as it applies to a reference under the Act.

Restrictions on financial promotions

60

In respect of a person to whom regulation 56 (temporary exemption relating to pre-existing contracts) applies, section 21 of the Act (restrictions on financial promotion) has effect as if for subsection (2) there were substituted—

(2) But subsection (1) does not apply if— (a) A is a person to whom regulation 56 (temporary exemption relating to pre-existing contracts) of the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 applies, and (b) the communication is necessary for the performance of a pre-existing contract (within the meaning of regulation 56 of those Regulations).

Information gathering

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The following provisions of the Act apply to a person to whom regulation 56 (temporary exemption relating to pre-existing contracts) applies as if they were an authorised person under the Act in relation to the carrying on of that activity—

• (a) section 165 (regulators’ power to require information: authorised persons etc.)⁶⁰;

• (b) section 166 (reports by skilled persons)⁶¹;

• (c) section 175 (information and documents: supplemental provisions)⁶²;

• (d) section 177 (offences)⁶³.

Publication of information

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• (1) The FCA may, where it considers it appropriate to do so, publish—

• (a) information concerning persons to whom regulation 56 (temporary exemption relating to pre-existing contracts) applies, in relation to the application of that regulation to them;

• (b) information provided under—

• (i) regulation 54 (notification by a person to whom regulation 53 applies);

• (ii) regulation 57 (notification by a person to whom regulations 56 applies).

• (2) Publication of information under this regulation must be in such manner as the FCA considers appropriate.

Public censure

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• (1) Where the FCA consider that—