London, June 6, 2025 - The UK's Financial Conduct Authority (FCA) announced on Friday a proposal to lift the ban on crypto exchange-traded notes (cETNs) for retail investors. This move aims to boost UK growth and competitiveness by allowing individuals to access crypto investment products, aligning the UK with countries like the U.S. and the EU.
The FCA's proposal allows cETNs to be sold to retail customers, provided they are traded on an FCA-approved investment exchange. This follows the FCA's recent proposals on stablecoins and other parts of the crypto regime outlined in its crypto roadmap. The FCA's executive director of payments and digital finance, David Geale, stated that the move demonstrates the commitment to supporting the growth of the UK's crypto industry.
Unlike U.S. spot Bitcoin ETFs, ETNs do not directly hold underlying assets but are debt securities. Financial promotion rules will apply to ensure consumers are informed about the risks. Kraken UK General Manager Bivu Das highlighted the significance of the move, emphasizing the market's maturity and the importance of regulatory changes for the UK's competitiveness in digital assets.
The FCA prohibited the sale of crypto derivatives and ETNs to retail consumers since January 2021. In March 2024, the FCA allowed RIEs to list crypto asset-backed ETNs for professional investors only. The UK has adopted a phased approach to crypto regulation, with full implementation expected in 2026. The FCA's ban on retail access to crypto derivatives will remain in effect.