FCA lifts crypto ban on ETNs for UK retail investors, effective October 8

Crypto industry stakeholders in the UK are praising the Financial Conduct Authority’s (FCA) decision to open access to crypto exchange-traded notes (ETNs) for retail investors, a move seen as a watershed moment for the country’s digital asset market. 

The new policy, set to take effect from October 8, 2025, lifts a long-standing ban and is likened by some to the “Big Bang” reforms of 1986 that transformed London’s financial sector.

While the FCA maintains its historically cautious stance toward crypto, citing investor protection as a central tenet, the regulator’s latest shift signals recognition of the growing maturity of digital assets and the need to remain competitive globally.

“This is extremely significant and in some ways it could be seen as the first step in a seismic shift in UK financial markets in terms of the acceptance and adoption of digital assets more generally,” said Russell Barlow, chief executive of 21Shares, a cryptocurrency exchange-traded products issuer.

He added that this may be one of the most significant reforms since the Big Bang.

FCA grants retail access, but with guardrails

The FCA’s reversal will permit retail investors to buy and sell crypto ETNs that reference Bitcoin or Ethereum, through Recognized Investment Exchanges (RIEs) like the London Stock Exchange.

Derivatives and leveraged products are still prohibited, and investments in crypto ETNs will not be covered by the Financial Services Compensation Scheme (FSCS).

For Dovile Silenskyte, director of digital assets research at WisdomTree, this marks “a pivotal moment in the broader integration of digital assets into the financial system.” WisdomTree and other asset managers, including Invesco and 21Shares, are expected to ramp up ETN offerings to meet anticipated demand.

The road ahead for UK crypto finance

While welcomed, the policy shift is seen by many as overdue. George Osborne, the former UK Chancellor of the Exchequer, warned in a recent op-ed in the Financial Times that the UK was falling behind the United States, Europe, and Asia in crypto innovation. He urged faster regulatory reform to match the dynamism of global markets.

In that context, the FCA’s crypto ETN decision is a first step, but far from sufficient. Asset managers and policymakers alike point out that a lack of clarity around stablecoins, DeFi, and crypto custody still creates friction for institutional and retail adoption.

The ban on derivatives and the limited options of traded cryptocurrencies still show that the UK is lagging behind continental Europe.

Analysts say the FCA’s new stance could create a domino effect, encouraging more domestic innovation, listings, and product development. According to reports, the move may also trigger renewed interest from fintech and crypto-native companies that had previously deprioritized the UK due to regulatory bottlenecks.

Still, hurdles remain. Platforms offering crypto ETNs must navigate complex disclosure, marketing, and compliance requirements under the FCA’s updated rules. At the same time, investor education will be critical.

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