The U.K.’s Financial Conduct Authority (FCA) is seeking views on intermediaries, staking, lending, borrowing, and decentralised finance (DeFi), in a discussion paper released on Friday.
The discussion paper follows draft legislation by the Treasury that was announced on Tuesday. Once the legislation passes it will bring specific crypto activities within the FCA’s regulation, the regulator said on its website.
“Crypto is a growing industry. Currently largely unregulated, we want to create a crypto regime that gives firms the clarity they need to safely innovate, while delivering appropriate levels of market integrity and consumer protection,” said David Geale, executive director of payments and digital finance at the FCA.
The crypto industry has said the regulator, which has had oversight of crypto since 2020 under its anti-money laundering rules, has been too restrictive at times. It has registered 51 firms of the 368 applications it’s received in the past five years. A new authorization regime for offerings should kick in by 2026.
Among the topics in the discussion paper is whether firms should be able to accept credit cards to pay for crypto purchases.
“We are considering a range of restrictions, including restricting the use of credit cards to directly buy cryptoassets, and using a credit line provided by an e-money firm to do so,” the discussion paper said.
The deadline for comments is June 13 and the FCA will consult on the final regime later this year.
UPDATE (May 2, 12:10 UTC): Adds no. of firms approved since 2020, credit card purchases starting in fourth paragraph.