LONDON
The UK Financial Conduct Authority announced two consultation periods seeking input on how decentralized finance companies can comply with existing anti-money laundering and financial crime rules, and opened a separate consultation on specific exclusions from broader crypto asset regulation.
The FCA said in a Wednesday notice that the proposed DeFi guidance aims to clarify existing rules rather than introduce new policy. The consultations follow the regulator's Sept. 30 opening of applications for its new crypto regulatory regime, with a Feb. 28, 2027 deadline for companies seeking compliance.
The new framework, expected to become enforceable in October 2027, includes specific provisions for stablecoin holding arrangements and reserve assets. The FCA cited recent legislative changes as the basis for its review of crypto asset exclusions, signaling continued refinement of UK digital asset oversight.
The UK Cryptoasset Business Council said DeFi represents a highly innovative segment of financial services and emphasized the need for a balanced regulatory approach. The Council called for clear perimeter rules, proportionate expectations, and a framework that fosters responsible innovation to prevent the sector from relocating outside the UK.
The regulatory actions follow the UK government's recent sanctions against three crypto exchanges for ties to illicit Russian funds, underscoring the FCA's focus on financial crime prevention in digital assets.
