FCA Cryptoasset Final Rules: What Changed From the Consultation Proposals
The Financial Conduct Authority's (FCA) final cryptoasset rules, published on 30 June 2026, keep the framework it consulted on but make targeted changes to prudential capital, safeguarding, trading, staking, lending and stablecoin issuance. The changes with the most practical effect are a simpler capital treatment for cryptoasset holdings, a halved capital factor for stablecoin issuers and more workable custody and staking rules. Firms that prepared gap analyses or draft applications against the consultation papers should check them against the final text.
The rules are set out in five policy statements made under the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026, which Parliament passed on 4 February 2026, and they apply from 25 October 2027. Our article on the FCA cryptoasset application window covers authorisation timing and the savings provisions; this article looks at what changed in the rules themselves.
What Did the FCA Publish on 30 June 2026?
The policy statements respond to four discussion papers and ten consultation papers issued since 2023, and contain the FCA's final rules and guidance. They are organised largely within a new Cryptoasset sourcebook (CRYPTO) and two new prudential sourcebooks. The package comprises five policy statements:
PS26/9: admissions and disclosures (A&D) and the market abuse regime for cryptoassets (MARC), mainly in CRYPTO 3 and CRYPTO 4.
PS26/10: stablecoin issuance, including CRYPTO 2 and the safeguarding of backing assets under CASS 16.
PS26/11: regulated cryptoasset activities in CRYPTO 5 to 10, including custody under CASS 17.
PS26/12: the prudential regime in the new COREPRU and CRYPTOPRU sourcebooks.
PS26/13: the application of the wider FCA Handbook, with guidance on the Consumer Duty (FG26/5), operational resilience (FG26/6) and international firms (FG26/7).
PS26/12 and PS26/13 apply to every firm; the others apply according to the firm's activities. Notably, the FCA states that it does not consider its changes to the consulted rules significant for the purposes of section 138I(5) of the Financial Services and Markets Act 2000 (FSMA), other than those to the prudential instrument. In other words, prudential is where the final position moved furthest.
Key Changes Under the Final Rules
A Simpler Capital Framework and a Lower Stablecoin K-Factor
Under PS26/12, the FCA has dropped the proposed two-tier classification of cryptoassets (Category A and Category B) for capital purposes. Cryptoassets that can be prudently valued and are admitted to a UK qualifying cryptoasset trading platform now attract a single 40% net risk position requirement (K-NCP) and a 40% volatility adjustment for counterparty credit default (K-CCD). Cryptoassets that do not meet those conditions are deducted from regulatory capital and carry a 100% volatility adjustment.
The FCA has also reduced the coefficient for the stablecoin issuance K-factor (K-SII) from 2% to 1%, which it describes as more proportionate for larger issuers. It has removed the proposed public disclosure of the own funds threshold requirement and liquid asset threshold requirement. Public disclosure of prudential information is now required only where the fixed overheads requirement or K-factor requirement, rather than the permanent minimum requirement, is the binding element of a firm's own funds requirement.
For firms holding cryptoassets on balance sheet, the platform admission test now matters directly to capital planning: holdings outside it are fully deducted. Separately, the FCA finalised its guidance on the overall risk assessment on 30 September 2026 as FG26/9 and FG26/10, both in force from 25 October 2027. Our earlier article on the proposed prudential regime sets out the framework these changes build on.
Safeguarding and Custody Under CASS 17
PS26/11 confirms that CASS 17 will apply to client cryptoassets, covering ownership rights, record-keeping, reconciliation and private key management. The main refinements are set out below:
targeted exceptions to the trust requirements, and clarification of when CASS 17 applies on a control basis;
the limit for the settlement float model increased to 2%;
a technology-agnostic approach to private key management, rather than prescribed methods;
CASS 17 not applied, for now, to custody of relevant specified investment cryptoassets, where firms authorised as cryptoasset custodians must apply CASS 6 instead;
CASS 7 applied to client money arising from, or in connection with, safeguarding client cryptoassets, although stablecoin issuers are not subject to CASS 7.
The FCA plans further engagement on tokenised asset custody and possible future CASS amendments, and a separate consultation on the resolution of cryptoasset custodians. Custodians should therefore treat CASS 17 as settled for application purposes, while expecting further change around failure and distribution.
Trading Platforms, Dealers and Arrangers
For UK qualifying cryptoasset trading platform operators and intermediaries, the FCA has removed principal dealers from pre-trade transparency requirements. It has also clarified best execution: firms need effective overarching arrangements, supported by periodic monitoring and post-trade analysis, rather than checks on every transaction, and the guidance addresses the use of multiple execution venues for price checks. The approach remains principles-based. These changes follow the proposals in CP25/40, which we covered in our analysis of the proposed cryptoasset activity rules.
Firms admitting cryptoassets to trading should review PS26/9. It clarifies due diligence, admission criteria and the trigger for supplementary disclosure documents, specifies a digital token identifier standard and strengthens withdrawal rights notifications. It also removes an exception that would have allowed a cryptoasset to be admitted without a qualifying cryptoasset disclosure document where it was fungible with one already admitted. Under MARC, the FCA has kept the industry-led framework and the threshold for large platform obligations, but narrowed the on-chain monitoring requirement for large platforms. Our review of the admissions, disclosures and market abuse proposals covers the original framework.
Staking, Lending and Borrowing, and DeFi
The FCA has kept its core retail protections for staking and for lending and borrowing, while removing restrictions that would have caught ordinary business models. For staking, client consent may now cover ongoing staking of current and future holdings, subject to conditions and an annual notification, so auto-staking arrangements are not unintentionally prevented. The FCA has also clarified how record-keeping applies to liquid staking, and will address staking perimeter questions in separate guidance.
For lending and borrowing, enhanced disclosures, consent, appropriateness testing, over-collateralisation and negative balance protection all remain. Firms may now stake retail client collateral, subject to CASS 17, and limits on automatic collateral top-ups apply only to firms, not to clients topping up manually. For decentralised finance (DeFi), the rules apply only where there is an identifiable controlling entity. The FCA will assess scope case by case and will consult on tailored DeFi guidance, so firms with DeFi elements face continuing uncertainty.
Stablecoin Issuance
PS26/10 keeps the core framework for UK stablecoin issuers, with changes aimed at proportionality and operability. The key changes are:
issuers no longer need to estimate redemption forecasts to meet the backing asset composition requirement;
statutory trust arrangements for backing assets are confirmed, and unallocated backing fund accounts are removed;
redemption timelines are adjusted to be operationally workable, with clarity on how redemption applies to the secondary market;
limited intragroup custody of backing assets is allowed, subject to safeguards;
up to a 5% excess may be held in the backing asset pool;
holders must have access to historical disclosures, and obligations on withdrawal rights are strengthened.
The FCA describes this as a baseline regime, with further work planned on payments use cases and on resolution. A joint publication with the Bank of England covers systemic stablecoins. Issuers should also note that a draft statutory instrument published in April 2026 proposes moving arranging and dealing in UK-issued qualifying stablecoins into a future payments regime, which is not yet law.
Handbook Obligations Confirmed
PS26/13 confirms that the Consumer Duty, the Conduct of Business Sourcebook (COBS), the Senior Managers and Certification Regime (SM&CR), operational resilience and the financial crime framework all apply to regulated cryptoasset activities. It is accompanied by updated Consumer Duty guidance in FG26/5 and operational resilience guidance in FG26/6, and clarifies the treatment of stablecoin issuers regulated jointly with the Bank of England.
What Do the Changes Tell Us About the FCA's Approach?
Read together, the changes show the FCA easing requirements where it judged them disproportionate or unworkable, while holding firm on retail protections and asset safeguarding. Capital, staking consent and best execution have all become more practical; retail lending protections and CASS 17 have not been diluted. The FCA applies a "same risk, same regulatory outcome" principle where it can, but accepts that market abuse risk in cryptoassets is likely to remain higher than in established markets, and that cryptoassets remain high-risk investments.
The regime is also not yet complete. The FCA has said it will consult later in 2026 on cryptoasset firm failure and on Financial Crime Guide updates covering anti-money laundering and know your customer expectations; neither had been published as at 16 October 2026. Further work on DeFi, distributed ledger technology, cryptoasset derivatives, audit requirements and supplementary regulatory reporting questions is also planned, and the FCA intends a formal review around two years after the regime comes into force.
What Should Firms Do Now?
The right response depends on which activities a firm carries on and how far its preparation has progressed. A firm that has already mapped its business against the consultation papers will usually need a targeted refresh rather than a fresh start. The following steps are a proportionate starting point:
Re-run any gap analysis or draft application prepared against the consultation papers, checking each against the relevant final policy statement.
Recalculate capital under the final market risk treatment, identifying which holdings can be prudently valued and are admitted to a UK qualifying cryptoasset trading platform.
Stablecoin issuers should revisit the K-SII calculation, backing asset composition and redemption procedures.
Custodians should confirm their CASS 17 design, including the settlement float limit, private key controls, CASS 6 treatment of relevant specified investment cryptoassets and CASS 7 client money arrangements.
Platforms, dealers and arrangers should update best execution policies and monitoring, and admission due diligence and disclosure processes.
Staking and lending providers should review consent wording, annual notifications and collateral arrangements.
Complete the overall risk assessment with reference to FG26/9 and, where relevant, FG26/10.
Record how the firm has interpreted areas still in development, such as DeFi scope and stablecoin activities.
Firms intending to rely on the savings provisions should do this work in time to apply before the window closes on 28 February 2027.
Frequently Asked Questions
When were the FCA's final cryptoasset rules published?
The FCA published its final rules and guidance on 30 June 2026 in five policy statements, PS26/9 to PS26/13. They apply from 25 October 2027, when the new cryptoasset regime comes into force.
How are cryptoassets treated for capital purposes under the final rules?
Cryptoassets that can be prudently valued and are admitted to a UK qualifying cryptoasset trading platform attract a 40% net risk position requirement and a 40% volatility adjustment. Cryptoassets that do not meet those conditions are deducted from regulatory capital.
Did the FCA change the capital requirement for stablecoin issuers?
Yes. The FCA reduced the coefficient for the stablecoin issuance K-factor (K-SII) from 2% to 1%, to make the prudential framework more proportionate for larger issuers.
Does CASS 17 apply to all cryptoasset custody?
No. CASS 17 applies to client cryptoassets, but not yet to custody of relevant specified investment cryptoassets. Firms authorised as cryptoasset custodians must apply CASS 6 to those assets for the time being.
Is the FCA's cryptoasset rulebook now complete?
No. The FCA plans further consultations, including on cryptoasset firm failure and Financial Crime Guide updates, and further work on DeFi, cryptoasset derivatives, audit requirements and regulatory reporting.
How Compliance Angle Can Help
Compliance Angle helps firms translate the final cryptoasset rules into an application and a compliance framework the FCA can assess with confidence. Relevant support includes:
FCA authorisation and application support, including refreshing draft applications and regulatory business plans against the final rules;
gap analyses and compliance frameworks and policies tailored to the firm's activities;
SM&CR support, including responsibilities maps and Statements of Responsibilities;
Consumer Duty support for firms serving retail customers;
risk management and governance, including board oversight and the governance around the overall risk assessment;
ongoing compliance support, including compliance monitoring plans once authorised.
Our support is practical and proportionate to each firm's business model, permissions, size and regulatory risk. If you would like to discuss how the final rules affect your firm or your application, please contact us at info@complianceangle.co.uk.
Source: Financial Conduct Authority, Overview of our cryptoassets regime policy statements (PS26/9 to PS26/13), published 30 June 2026; FG26/9, published 30 September 2026.
