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The UK’s Financial Conduct Authority (FCA) will allow retail investors to trade crypto exchange-traded notes (ETNs) starting October 8.
Author: Sahil Thakur
The UK’s Financial Conduct Authority (FCA) will allow retail investors to trade crypto exchange-traded notes (ETNs) starting October 8. This marks a partial reversal of its 2021 ban on crypto investment products. However, crypto derivatives remain off-limits.
Only ETNs listed on Recognised Investment Exchanges will qualify. Investors must also accept full risk, there is no compensation coverage.
In 2021, the FCA banned crypto ETNs over concerns about volatility and investor harm. That ban kept retail users from accessing products tied to crypto prices.
But things have changed. The FCA now believes the market is more mature. Crypto products are better understood, and investors are more informed.
“Since we restricted retail access to cETNs, the market has evolved,” said David Geale, the FCA’s director of payments and digital finance. “We’re now offering more choice – alongside protections.”
Firms offering crypto ETNs must follow detailed rules. These include:
Only ETNs listed on approved UK exchanges qualify. And investors won’t get protection from the Financial Services Compensation Scheme (FSCS). If an issuer fails, users could lose their entire investment.
Crypto ETNs are not the same as owning digital tokens. They are unsecured debt securities that mirror crypto prices. Investors hold no actual crypto and have no claim on the assets.
While ETNs get a green light, the FCA is keeping its ban on crypto derivatives for retail users. Products like futures and options remain restricted. The regulator still sees them as too complex and risky.
No changes to this policy are expected anytime soon.
This move fits into the FCA’s broader strategy. The regulator has proposed stablecoin rules and laid out a digital asset roadmap. The goal is to bring crypto under a formal regulatory structure without shutting it out entirely.
The new ETN rules start on October 8. Issuers now have two months to prepare. All eyes are on how many products will launch—and how investors respond.
2000: Electronic Communications Act – Recognized electronic signatures, regulated cryptographic services.
2018: Sanctions and Anti‑Money Laundering Act – Enabled UK-specific AML and sanctions rules.
Jan 2021: FCA requires all UK crypto firms to register under AML rules.
Jun 2021: Binance ordered to cease UK regulated activity. License fully canceled in Jun 2023.
Jun 2024: FCA reported only 14% crypto firm approval rate (47/347 applications).
Oct 2023: FCA launches crypto promotions regime with risk warnings.
Q1 2024: Introduced appropriateness assessments for retail crypto users.
2020–Mar 2024: Ban on crypto derivatives for retail traders reaffirmed.
Oct 2023: HM Treasury confirms intent to bring crypto into FSMA 2023 scope.
Nov 2023: Joint FCA/BoE discussion paper on stablecoin regulation.
Nov 2024: FCA publishes crypto roadmap—full regime targeted for 2026.
Dec 2024: First discussion paper on crypto markets, disclosures, and abuse rules.
Apr–May 2025: Draft FSMA (Cryptoassets) Order published. FCA consults via DP25/1, CP25/14 & CP25/15.
2026 (expected): Full regime launched—stablecoins, disclosures, custody, and market conduct fully regulated.
Jun 2025: FCA opens consultation to possibly lift ban on retail crypto ETNs.
| Year / Period | Milestone |
|---|---|
| 2000 | Electronic Communications Act |
| 2018 | Sanctions and Anti-Money Laundering Act |
| Jan 2021 | FCA crypto registration begins |
| Jun 2021 | Binance banned from UK activities |
| Oct 2023 | FCA crypto promotions regime starts |
| Q1 2024 | Retail appropriateness rules added |
| 2020–2024 | Retail crypto derivatives ban reaffirmed |
| Nov 2024 | Crypto roadmap released |
| Apr–Jun 2025 | Draft legislation + consultations |
| 2026 | Full regulatory regime expected |
| Jun 2025 | ETN ban under review |
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