The UK’s financial watchdog has launched a sweeping consultation that could reshape how crypto exchanges, staking services and DeFi operate ahead of a 2027 rollout.
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The United Kingdom is taking a decisive step toward fully regulating its crypto market. This week, the Financial Conduct Authority (FCA) launched a wide-ranging consultation outlining proposed rules for crypto exchanges, staking services, lending platforms and decentralized finance.
The proposals follow new secondary legislation from the UK Treasury that formally brings crypto activities into the country’s financial services framework, with a target implementation date of Oct. 25, 2027.
In this week’s episode of Byte-Sized Insight, Cointelegraph explored what this consultation signals for the UK crypto market and how industry leaders are interpreting the regulator’s direction. We spoke with Perry Scott, head of UK policy at Kraken and chair of the UK Cryptoasset Business Council, to break down what’s new and what’s at stake.
From fragmented oversight to full market structure
Until now, the UK’s approach to crypto regulation has been piecemeal. Companies have operated under anti-money laundering rules and strict financial promotion requirements, but there has been no unified framework governing how crypto markets should function.
Scott described the moment as long anticipated.
“Christmas has come early for policy nerds like me,” he said, pointing to the scale of the proposals, which span “around 700 pages to sink our teeth into.”
More importantly, the consultation comes with a firm timeline. “Mark your calendars because the firing gun has been fired,” Scott said, referring to the 2027 go-live date, which gives a signal that the industry is moving from waiting to preparing.
Related: Europe reconsiders crypto oversight as ESMA centralization gains momentum
Exchanges, staking and lending take center stage
At the core of the consultation is market structure, particularly how exchanges are regulated and how they access liquidity. Scott welcomed the FCA’s recognition that crypto markets are inherently global, saying that “accessing global liquidity will support better execution outcomes for consumers.”
The UK is also carving out a distinct approach to staking. Earlier this year, it became one of the first major jurisdictions to separate staking from traditional financial services rules. Under the consultation, staking would be governed by bespoke requirements, a move Scott called “world leading.”
The consultation is open until Feb. 12, and companies are already adjusting.
“UK firms aren’t going to sit around and wait,” Scott said.
He said regulatory certainty could create “hundreds, if not thousands of jobs” across compliance, legal and technical roles.
As the UK positions itself between the EU’s Markets in Crypto-Assets Regulation (MiCA) regime and renewed regulatory momentum in the US, the outcome of this process could determine whether it emerges as a competitive crypto hub or struggles to keep pace.
To hear the complete conversation on Byte-Sized Insight, listen to the full episode on Cointelegraph’s Podcasts page, Apple Podcasts or Spotify. And remember to check out Cointelegraph’s full lineup of other shows!
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