FCA Publishes Crypto Asset Regulatory Framework for Overseas Platforms

The UK Financial Conduct Authority (FCA) has published a new regulatory framework for crypto assets. The framework allows overseas trading platforms to serve UK users through locally authorized branches and connect to global trading infrastructure.

This approach is intended to avoid creating a closed domestic liquidity pool, according to the FCA. It also permits stablecoins issued outside the UK to circulate in the UK market, differing from the European Union's Markets in Crypto-Assets (MiCA) model.

The new rules introduce a 'Qualified Cryptoasset Trading Platform' (QCATP) mechanism, which is expected to improve price efficiency and market depth. However, industry sources have expressed uncertainty about which jurisdictions will be recognized as providing comparable regulatory protections.