Draft Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025

Lucy Rigby Excerpts

Tuesday 20th January 2026 General Committees

[The Economic Secretary to the Treasury (Lucy Rigby)]

I beg to move,

That the Committee has considered the draft Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2025.

This statutory instrument delivers a comprehensive regime for the regulation of cryptoassets within the Financial Services and Markets Act 2000 framework, meaning that cryptoassets will be regulated under the same architecture as other financial services. Coupled with the rules being prepared by the Financial Conduct Authority, the regime will protect consumers and give technology and financial services firms the certainty they need to invest and grow in the UK. There is a general trend towards more people investing in cryptoassets in the UK; as they become more intertwined with traditional financial services, it is critical that we offer appropriate protection and get our approach to regulation right.

Previous intervention in this space has focused on addressing the most urgent risks first, namely money laundering and misleading financial promotions. However, as it stands, most cryptoasset activities are not subject to broader financial services regulation covering matters such as conduct and prudential requirements. Consumers and industry have long called for clear and comprehensive oversight of cryptoassets in the UK, and the Treasury first consulted on these proposals in 2023 under the previous Government. In October 2024, this Government committed to implementing a regime largely in line with the consultation proposals. The instrument before us today delivers on that commitment.

The instrument amends the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 to do two principal things: first, to define the categories of cryptoasset that will be in scope of the regime; secondly, to define the new activities that will be regulated. Generally, firms undertaking those activities in the UK or for UK consumers must be authorised by the FCA or risk committing a criminal offence. The new activities are: issuing qualifying stablecoin in the UK; safeguarding qualifying cryptoassets and relevant specified investment cryptoassets; operating a qualifying cryptoasset trading platform; dealing in qualifying cryptoassets as principal or agent, or arranging deals in qualifying cryptoassets; and qualifying cryptoasset staking.

The instrument also uses the new designated activities regime to create frameworks governing public offers of qualifying cryptoassets and their admission to trading on relevant platforms and to tackle market abuse in relation to such cryptoassets. As people will have spotted, it also makes consequential amendments to various pieces of legislation to ensure that the regime can operate effectively and to ensure consistency between the cryptoasset regulatory framework and the rules that apply to traditional financial services. The provisions will take effect from 25 October 2027, which will allow the FCA to consult and finalise rules this year, and give at least 12 months for firms to apply for authorisation and the FCA to process applications ahead of the enforcement date.

In conclusion, as I have set out, this regime will raise standards, strengthen consumer protection, help to tackle market abuse and support the responsible growth of the UK’s cryptoasset sector by providing clear and consistent rules. It brings cryptoassets within the robust Financial Services and Markets Act framework while ensuring that the sector has the space and flexibility to innovate. I hope the Committee will join me in supporting this instrument.

--- Later in debate ---

[Lucy Rigby]

I am grateful to the whole Committee for their consideration of this matter—in particular the shadow Economic Secretary to the Treasury, the hon. Member for Wyre Forest (Mark Garnier). I share his vital commitment to continuous innovation in financial services. I would argue that what has made London and our financial services hub as world-leading as we are is our continuous embracing of innovation—he went quite some way back with coffee shops. I also share his view that the next stage of innovation, which is critical to embrace, concerns stablecoin, digital assets and tokenisation much more broadly. It is fair to say that we are coming at this from the same place.

With regard to stablecoin specifically, we wholeheartedly agree on the potential of stablecoin to play a really significant role in both retail and wholesale payments. The shadow Economic Secretary rightly refers to qualifying stablecoins as a definition being a subset of qualifying cryptoassets. He also recognises that this SI aims to bring the issuance of stablecoin within the FCA’s perimeter, which I distinguish from using stablecoin as a method of payment. Again, I think we are on the same page in relation to that.

There is a deliberate carve-out for stablecoin payment activities in this SI, because we have carved out any transaction for the purposes of the supply of goods or services. The intention is to deal with the use of stablecoins as a method of payment in the context of the upcoming payments strategy. An awful lot of work will be done on that over the course of this year, because, as the shadow EST rightly refers to, the UK is a leader in payments innovation, and stablecoin is a key piece of that.

There are other pieces of the stablecoin picture; as I am sure the hon. Gentleman knows, the Bank is currently consulting on a systemic stablecoin. Quite what will constitute “systemic” is yet to be defined, so that remains an area in which the industry is, understandably, looking for answers. As I said, the Bank’s consultation is open, and the FCA is also consulting on the detailed rules that will underpin this regime.

I note, and very much welcome, the shadow EST’s support in principle for these measures. It is critical that we make sure that every single i is dotted and every t is crossed. We all want this to go right, and I certainly do not want there to be anything that subsequently becomes an issue. I am not sure that there is at this point but, as I say, while I note his support in principle, I would nevertheless be more than happy to talk to him at a mutually convenient time, and for him to bring in the experts that he referred to. We can then hopefully persuade him that this is completely kosher as it is, or he can tell us why he does not think that that is the case. That is a meeting that I am more than happy to have.

I am grateful to members of the Committee for their consideration of this SI, and I hope they will join me in supporting these measures.

Question put and agreed to.