FCA consults on crypto exclusion guidance and offers targeted application flexibility

The FCA’s 21 October consultation addresses crypto authorisation exclusions ahead of the regime starting on 25 October 2027.[2]

Draft guidance says the technical-access exclusion concerns non-authorised businesses that are not payment-service providers. Access must concern an authorised or exempt third-party service, or a decentralised protocol. Selecting counterparties or materially shaping transactions can prevent reliance, including through software.[2]

Firms whose ability to complete applications is materially affected by uncertainty about that exclusion may receive extra time for arranging-permission details, provided they submit an otherwise complete application within the 30 September 2026–28 February 2027 window.[1]

Operating responsibilities continue through decentralised systems

The connected GC26/7 consultation explains how existing operational-resilience and financial-crime requirements apply when firms use decentralised finance. It is proposed interpretive guidance for relevant firms, including applicants for the future regime.[3]

The FCA identifies dependencies on bridges, data feeds and interconnected protocols, where a failure can interrupt several services. Firms need to consider incident response and recovery resources, customer communications and whether important services can remain within their disruption tolerances.[3]

Responsibility for applicable outsourcing and third-party requirements remains with the regulated firm. For a broker connecting to a protocol, the operating assessment therefore reaches beyond the interface to the components supporting execution and client access.[3]

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