FCA Clears Crypto Rulebook, but UK Banks Can Still Block Transfers

The UK Financial Conduct Authority (FCA) has issued final guidance that clarifies which crypto‑asset businesses will require authorization under the new regulatory framework set to start on 25 October 2027. While the guidance removes a key source of uncertainty for firms, banks in the United Kingdom retain the ability to limit or block crypto‑related transfers, creating a separate hurdle for the sector.

Key Dates and Scope of the New Regime

• The FCA’s final crypto‑asset perimeter guidance was published on 16 September 2026. • From 25 October 2027, firms carrying out covered activities will generally need FCA authorization unless an exemption or transitional arrangement applies. • Covered activities include stablecoin issuance, crypto trading platforms, dealing and arranging transactions, custody and staking services. • The rules also apply to overseas firms serving UK customers and traditional financial institutions entering the crypto space.

Application Timeline

Applications for authorization open on 30 September 2026, with a transition window that closes on 28 February 2027. Existing registrations will not automatically convert to the new authorizations, requiring firms to submit fresh applications.

Banking Access Remains Uncertain

Despite regulatory approval, nine of the ten largest UK retail banks continue to block or limit crypto‑related transactions, according to industry data. The FCA is not expected to compel banks to lift these restrictions, leaving each bank to decide its own risk appetite. The government has indicated that banking decisions are largely commercial, while also stating that licensed crypto firms should not face restrictions solely because of their sector.

Parliamentary Pressure

The House of Lords recently supported Amendment 88 to the Financial Services and Markets Bill, urging the Treasury to develop a national digital‑assets strategy covering crypto, stablecoins, tokenisation and banking access. The amendment passed 194‑138 and has moved to the House of Commons, but is not yet law.

Implications for the UK Crypto Market

The FCA guidance provides regulatory certainty, but the practical ability of crypto firms to access banking services remains a critical test for the sector’s growth.