Insights

This Client Alert focuses on the FCA Crypto Roadmap and regulatory approach, including the proposed timeline of events for crypto firms to consider in 2025 and 2026.

On 3 December 2024, Commission Implementing Regulation (EU) 2024/2984 laying down implementing technical standards for the application of MiCA with regard to forms, formats and templates for the crypto-asset white papers (the ITS) was published in the Official Journal of the EU. The ITS enters into force on 23 December 2024 and will apply from 23 December 2025.

On 25 November 2024, HM Treasury published a keynote address by a government minister at the Tokenisation Summit, outlining the UK Government’s ambitious plans to position the nation as a global leader in tokenisation and digital asset innovation. The speech underscored the government’s commitment to embracing emerging and disruptive technologies, which are anticipated to transform the financial services landscape.

The election of Donald Trump as the 47th President of the United States and the Republican sweep of Congress mark a pivotal moment for the crypto industry.

In an intensified crackdown on illegal financial promotions, the Financial Conduct Authority (FCA) has initiated targeted measures against “finfluencers”—social media influencers who promote financial services products. As of this month, 20 individuals are being interviewed under caution, with 38 alerts issued for social media accounts suspected of unauthorised promotions.

The Virtual Assets Regulatory Authority (VARA) is continuing its enforcement efforts to safeguard Dubai’s virtual asset ecosystem, targeting unlicensed firms operating within its jurisdiction. As part of a wider enforcement programme, VARA has issued cease-and-desist orders, along with accompanying fines, to 7 entities for operating without the required licenses and for breaching marketing regulations. Further investigations are underway in collaboration with local authorities.

FCA Updates on Cryptoasset Financial Promotions

MICA Disharmonisation: The Rocky Road to EU Crypto-Assets Regulation

HM Treasury has published a consultation on improving the effectiveness of UK Money Laundering Regulations.

ESMA consults on reverse solicitation and classification of crypto assets as financial instruments under MiCA

Navigating the Crypto Frontier in 2024

US SEC approves ETFs in watershed for digital asset market

UK Government publishes its latest proposals to regulate the UK cryptoasset sector

The FCA has issued 146 alerts about cryptoasset promotions on the first day of the new regime and published a Warning List.

The Financial Conduct Authority issued an industry-wide letter on 7 September 2023 on the incoming UK Cryptoasset Financial Promotions Regime

The Law Commission of England and Wales has unveiled their groundbreaking Final Report on Digital Assets. This marks a major leap in the law's evolution to embrace crypto and digital assets.

The FCA has published its Policy Statement (PS23/6) on financial promotion rules for cryptoassets. This follows the publication of legislation on 7 June 2023 to bring cryptoassets into the FCA’s remit.

Over the last year it has become clear that blockchains and the software movement around them - can only succeed with a clear regulatory regime that provides an open pathway for startups while also protecting consumers from fraud and manipulation.

SEC Legal Action Against Coinbase and Binance. The SEC’s recent lawsuits against Coinbase and Binance should serve as an urgent wake-up call for all crypto firms and projects.

HMT Announces Financial Services and Markets Act 2000 (Financial Promotion) (Amendment) Order 2023Cryptoasset firms that market to UK consumers, including those based overseas, will need to comply with the new UK financial promotions regime once it is implemented.

Ambitious plans to protect consumers and grow the economy by robustly regulating cryptoasset activities have been announced by the UK Government.

The exceptional events of 2022 will shape the crypto industry for years to come. In 2023, it will be important for firms and individuals to stay alert to the rapidly changing business and regulatory landscape in relation to crypto and digital assets. ‍Our latest briefing sets out a few items for Clients to consider in the year ahead.

The Bank of England’s Sir Jon Cunliffe provides some reflections on crypto-currencies and regulation in light of the FTX debacle.

US President Joe Biden and G20 world leaders have called the need for international rules to govern the fast-growing bitcoin and crypto space "critical".

The Financial Stability Board (FSB) has published a proposed framework for the international regulation of crypto-asset activities.

Speaking at SIBOS, the Bank of England’s Sir Jon Cunliffe, set out his thoughts on “crypto finance” risks.

The European Union (EU) has agreed upon the full legal text of its landmark legislation known as the Markets in Crypto Assets Regulation (MiCA), alongside a further law to reveal the identity of those making crypto payments.

Digital assets, including cryptocurrencies, have seen explosive growth in recent years, surpassing a $3 trillion market cap last November and up from $14 billion just five years prior. Surveys suggest that around 16 percent of adult Americans – approximately 40 million people – have invested in, traded, or used cryptocurrencies. Over 100 countries are exploring or piloting Central Bank Digital Currencies (CBDCs), a digital form of a country’s sovereign currency.

LawBEAM’s response to the Call for Evidence from the All-Party Parliamentary Group on Crypto and Digital Assets.

MiCA Client Briefing

EU MiCA deal agreed between EU Parliament and Council.

U.S. Senators Cynthia Lummis and Kirsten Gillibrand have published comprehensive proposals to legislate on cryptocurrencies, blockchain, and digital assets.

Without irony, the UK Government is proposing to apply the lessons of big bank failure to cryptocurrencies. The new proposals are set out in HM Treasury’s latest consultation paper titled “Managing The Failure of Systemic Digital Settlement Asset (including Stablecoin) Firms”.

G7 Finance Ministers and Central Bank Governors met last week to discuss global economic conditions, including cryptocurrency.

The Bank of England’s Prudential Regulation Authority (PRA) has announced it is increasing staff numbers to keep track of new risks linked to crypto assets and "new policy responsibilities".

Client Briefing - UK Stablecoin Regime

The UK Government has announced moves that will see stablecoins recognised as a valid form of payment as part of wider plans to make the UK a global hub for cryptoasset technology and investment.

The BOE, PRA, and FCA publish reports on Crypto-assets and Decentralised Finance.

The ASA has issued an enforcement notice to over 50 firms advertising crypto services. This move comes as part of the nationwide crackdown on UK crypto adverts.

The White House earlier today announced the first ever, “whole-of-government” approach to supervising and regulating the crypto industry.

BlockFi Agrees to Pay US$100 Million in Penalties to the SEC

Crypto-asset markets are fast evolving and could reach a point where they represent a threat to global financial stability due to their scale, structural vulnerabilities and increasing interconnectedness with the traditional financial system.

The UK Government has confirmed its intention to legislate to bring crypto-assets into the scope of the Financial Promotions Regime. The new regime is intended to tackle misleading crypto-asset promotions and adverts.