On Regulating Cryptoasset Activities

Editor's Note:

In May 2025, the UK Financial Conduct Authority (FCA) published the Discussion Paper Regulating Cryptoasset Activities(DP25/1). This document addresses regulatory challenges arising from the expansion of the crypto industry by focusing on six core activities:​Cryptoasset Trading Platforms (CATPs) operations,Intermediation services,Lending activities,Credit purchase restrictions,Staking services,Decentralised Finance (DeFi).

The report introduces  non-discretionary trading rules and  transparency requirements  for CATPs, proposing a  branch-subsidiary hybrid structure to resolve regulatory challenges for international operators. For consumer protection, the FCA implements differential regulation for lending and staking activities:Restricting retail clients' participation in high-risk lending ,Standardizing staking services through disclosure mandates and asset segregation,Advocating "same risk, same regulation" principles for DeFi, aligning its regulatory standards with traditional finance.

To balance financial stability and market dynamism, the FCA employs dynamic adjustment mechanisms aligned with international standards (e.g., IOSCO, FSB guidelines) and establishes market feedback channels for ongoing calibration.

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