Key Highlights
- The UK plans to bring crypto firms under FCA oversight by 2027.
- HMRC will mandate domestic crypto reporting from January 2026.
- Digital assets are now legally recognized as property in the UK.
The United Kingdom is accelerating efforts to formally regulate cryptocurrency markets, as the Treasury prepares new rules to bring digital assets under the same oversight as traditional financial products.
Led by Finance Minister Rachel Reeves, the initiative aims to strengthen consumer protection, improve transparency, and reinforce the UK’s position as a global financial hub as crypto adoption continues to grow.
According to the report, UK-based crypto exchanges and service providers will fall under Financial Conduct Authority (FCA) supervision, with phased implementation through 2027 as authorities respond to scams and investor risks.
Domestic crypto reporting from 2026
Starting January 1, 2026, UK-based crypto service providers will be required to collect and report transaction data for all UK-resident customers. This extends the OECD’s Crypto-Asset Reporting Framework (CARF) into domestic enforcement.
The measure is designed to combat tax evasion and improve visibility into crypto-related income and gains. HM Revenue & Customs (HMRC) aims to close tax gaps by aligning domestic crypto reporting with global standards and strengthening compliance oversight.
Treasury tightens oversight
Alongside tax reporting, the Treasury is now drafting broader rules that will bring crypto firms into the UK’s “regulatory perimeter.” This would align crypto with traditional finance, adding clearer rules, stronger protections, and tighter AML checks.
Officials argue the framework will boost confidence without stifling innovation. Both the Bank of England (BoE) and the FCA have promised to finalize their rules by the end of 2026.
Daniel Slutzkin, head of UK at crypto exchange Gemini, said firms had “long awaited regulatory clarity” and could now start preparing to meet the new requirements.
UK property law reform
The regulatory push is reinforced by a recent legal shift. In December, the UK formally recognized crypto as property, giving users clear rights to own, transfer, inherit, and recover digital assets after years of legal gray areas.
Taken together, the moves signal a hard turn in how the UK treats crypto. Investors get more protection and clarity, but the message is blunt: play by the rules, or don’t play at all.
Also read: FCA Adds Eunice to Sandbox to Test UK Crypto Disclosures
