The Investment Association has launched a new report, designed to help the investment management industry prepare for the UK Crypto Assets Regime.
The ‘UK Crypto Assets Regime: How the investment management industry can navigate new waters’ report, produced in collaboration with Travers Smith, helps firms understand the scope and impact of the new regulated activities regime and explains how they can capitalise on innovation.
The report comes as the UK recently unveiled a roadmap for its cryptoassets regulatory regime, which is expected to come into force in October 2027 and will bring a wide range of crypto asset-related activities into full FCA regulation for the first time.
The Investment Association says firms should begin the process of understanding how their digital asset activities and wider business models will be impacted by the new regulatory framework and future digital market evolution, and should start planning for a variation of permission application or for entities not currently engaged in digital markets, an application for FCA authorisation.
If digital asset-related activities fall outside the new regulatory framework, firms should still ensure registration under the existing Money Laundering, Terrorist Financing and Transfer of Funds crypto asset regime where required.
Finally, the trade body has recommended firms continue to monitor further FCA guidance and supervisory statements.
John Allan, director of innovation and operations unit and director of Engine, said: “Investment managers are at a pivotal moment in the evolution of digital markets, as DLT enables transformative new ways of transacting in tokenised funds, digital representations of mainstream assets, and increasing exposure to native cryptoassets.
“Beyond ensuring compliance, firms have a critical opportunity to use this shift both as a strategic initiative and a catalyst for profound innovation.
“Our report provides clear, practical guidance to help firms understand the implications of the new regime, assess their regulatory exposure, and make informed decisions that position them competitively for the opportunities ahead in digital markets.”
Natalie Lewis, head of fintech, market infrastructure and payments at Travers Smith, added: “With the legislation now in place and detailed final FCA rules expected relatively soon, now is the time for fund and investment managers to begin analysing the impact of the new framework on their current and planned business models. October 2027 will come around quickly and understanding a firm’s potential touchpoints with the new cryptoasset rules will be crucial, particularly as more investment activity moves on-chain.”
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