The UK is set to reform cryptocurrency regulations by 2026, enhancing oversight beyond AML to address stablecoins, exchanges, and lending. New licensing requirements for crypto businesses will take effect, impacting exchanges significantly. Strategies for businesses to adapt proactively and support from the government suggest a growing acceptance of cryptocurrencies, which are classified as personal property under UK law.
The UK is set to thoroughly revise its cryptocurrency regulations by 2026, which will include stablecoins, lending practices, and exchanges. Until now, the Financial Conduct Authority (FCA) primarily concentrated on anti-money laundering (AML) efforts; however, it will broaden its oversight to encompass the entire crypto sector. This article discusses the upcoming changes in UK crypto regulations, the strategic preparations by businesses, and the current landscape of the cryptocurrency market in the UK.
The proposed overhaul will include comprehensive regulations for cryptocurrencies. Policy documents on stablecoins, trading platforms, and staking are expected to be released this year, with final regulations anticipated next year. A new licensing framework for crypto businesses will be introduced in 2026, requiring exchanges like Coinbase and Gemini to reapply for FCA approval.
These regulatory initiatives may influence meme coins, such as Dogecoin, which have surged in popularity due to social media trends. As a result, projects affecting meme coin rankings may undergo regulatory scrutiny, providing much-needed clarity to the industry.
Since 2020, crypto companies in the UK have been mandated to register for AML compliance; however, approval rates have been low. The new regulations will necessitate a re-certification process for previously registered companies. There is debate within the industry over whether regulations will target company incorporation in the UK or be user-centric.
The FCA’s announcement forms part of a broader roadmap for cryptocurrency regulation, gradually evolving since 2024 to create a comprehensive framework. Policymakers and industry insiders are exploring various perspectives to balance innovation with investor safety. Ongoing discussions about decentralized digital assets and international data privacy regulations are expected to continue, with stakeholder engagement playing a pivotal role in shaping effective outcomes.
Businesses are encouraged to start preparing for the upcoming regulations proactively. Developing adaptable strategies now, rather than waiting for the finalised regulations in 2026, is essential for maintaining competitiveness in an evolving landscape. Companies that react quickly to changes and prepare in advance will fare better as regulatory impacts unfold.
The UK government is actively fostering growth in the cryptocurrency sector, viewing regulatory uncertainty as a potential market destabiliser. Since November, it has aimed to formulate policies that cover staking services and other crypto-related activities, with expected regulations by early next year. Interest in the cryptocurrency market remains robust, with approximately 12% of UK adults owning cryptocurrencies. Under UK law, cryptocurrencies are classified as personal property, which carries corresponding tax and legal obligations.
