Cryptoasset Perimeter Guidance: Authorisation Requirements from October 2027

At a Glance

At a Glance - The FCA’s PS26/18 guidance defines the regulatory perimeter for cryptoasset activities that will require FCA authorisation from 25 October 2027, and it details a transitional application window that opens on 30 September 2026 and closes on 28 February 2027.

The FCA is expanding the regulated perimeter to cover activities such as safeguarding cryptoassets, operating trading platforms, arranging deals and staking. Existing permissions under the Money Laundering Regulations, Payment Services Regulations or Electronic Money Regulations will not automatically transfer, meaning firms must assess whether a new FSMA authorisation or a variation of permission is needed.

The guidance is aimed at crypto‑focused firms, traditional finance organisations exploring crypto markets, payment service providers and any entity that registers under the MLRs. It links to the broader cryptoasset regime published on 30 June 2026 and signals the FCA’s intent to support a smooth transition through webinars, pre‑application support and ongoing engagement with the PRA.

What the Final Rules Change

New regulated cryptoasset activities

From 25 October 2027 the Cryptoasset Regulations introduce a set of regulated activities, including safeguarding cryptoassets, operating a trading platform, arranging deals and staking, which will require FCA authorisation unless an exemption or transitional provision applies.

Transitional application window

The FCA has opened a specific window for firms wishing to use the savings and transitional run‑off provisions; applications can be submitted from 30 September 2026 and must be received by 28 February 2027. This window is the only period during which firms can rely on the transitional provisions.

Interaction with existing regimes

Existing registrations under the Money Laundering Regulations, Payment Services Regulations or Electronic Money Regulations do not convert automatically to FSMA authorisation. Firms must map current permissions against the new cryptoasset activities and determine whether a variation or fresh authorisation is required, while continuing to satisfy threshold conditions and financial‑crime rules.

Implementation Dependencies

Firms should begin by mapping each of their crypto‑related services against the activity list in Chapter 4 of the guidance. This mapping will identify whether a service falls within the regulated perimeter and, if so, which specific permission - for example, safeguarding or arranging - is required. The analysis must consider the interaction with the Money Laundering Regulations, as the FCA expects continued compliance with AML rules post‑authorisation. MEMA recommends establishing a cross‑functional working group that includes compliance, legal, product and technology to produce a definitive perimeter assessment within the next four weeks.

The application window creates a hard deadline for firms that wish to rely on the savings and transitional provisions. Preparation should include gathering evidence of existing controls, drafting a variation request where an existing FSMA permission is being extended, and arranging pre‑application meetings (PASS). Dual‑regulated firms must also coordinate with the PRA. MEMA advises scheduling the PASS booking by early November 2026 to allow sufficient time for FCA feedback before the 28 February 2027 cut‑off.

Who Must Act

The guidance directly targets firms that currently carry out or plan to carry out regulated cryptoasset activities in the UK. This includes crypto‑asset custodians, trading platform operators, arrangers of staking services, issuers of electronic money, payment service providers and traditional finance firms that are testing crypto markets overseas. It also applies to entities already authorised under the FSMA, as well as those registered under the Money Laundering Regulations, who may need additional permissions for crypto activities.

While the PS is relevant to any organisation interested in the evolving cryptoasset framework, the FCA explicitly states that the guidance is for firms that will be carrying on regulated cryptoasset activities by way of business in the UK. Firms that are merely monitoring the market but do not intend to undertake a regulated activity are not required to seek authorisation, although they should stay informed of future consultations.

Board Assurance

The board should ask whether any current business lines will fall within the newly defined regulated cryptoasset activities and, if so, whether the firm holds the appropriate FSMA authorisation or a valid exemption. Evidence required includes the activity mapping, legal opinions on exemptions and a timeline for any required authorisation applications, all of which should be presented at the next board risk committee meeting.

The board must also consider the operational impact of transitioning from MLR registration to FSMA authorisation, including the need to satisfy threshold conditions, maintain AML controls and align reporting with the FCA’s financial‑crime rules. Documentation of the transition plan, resource allocation for the authorisation process and confirmation of PRA engagement for dual‑regulated entities will provide the assurance the board needs to endorse the transition strategy.

Implementation Priorities

Source Evidence

Plain English Glossary

• AML - Anti-Money Laundering. Controls and processes firms must operate to detect, prevent, and report money laundering activity.
• PRA - Prudential Regulation Authority. Bank of England body responsible for prudential supervision of banks, building societies, insurers, and major investment firms.
• PS - Policy Statement. FCA publication confirming final rules following consultation, typically with the new Handbook text and feedback summary.

Disclaimer

This article is for general information only and does not constitute legal or regulatory advice. Firms should assess the application of regulatory requirements by reference to their permissions, products, customers and operating model.

How MEMA Can Help

MEMA can help firms translate regulatory change into practical controls, policies, monitoring activity and board evidence. Book a free scoping call to discuss what this development means for your firm.

MEMA helps firms apply regulatory developments through its FCA authorisation support.

Further reading: FCA authorisation timelines and planning.