The FCA reverses its 2021 ban, citing a maturing crypto market

According to the United Kingdom’s Financial Conduct Authority (FCA), it has granted access to retail users access crypto exchange-traded notes (cETNs). It attributes its pivot to the growth of the crypto market and a better understanding of its products in recent years.

This was shared by David Geale, executive director of payments and digital finance at the FCA, “Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood. In light of this, we’re providing consumers with more choice, while ensuring there are protections in place.”

He also said, “This should mean people get the information they need to assess whether the level of risk is right for them.”

This change is expected to come into force by October 8, 2025.

The FCA opens the door, but risks remain

In its announcement, the FCA pointed out that retail consumers can only access cETNs via UK-based Recognised Investment Exchanges (RIE).

Therefore, firms that will be offering these products to the public must follow the regulators’ rules on how to promote the assets. Among these rules are the provision of information on how the products work and no inappropriate marketing offers to incentivize consumers, among others.

The FCA’s Consumer Duty rules will also apply, which require firms to act in the best interest of retail customers.

However, should investments go south, investors are on their own, as they are not protected by the Financial Services Compensation Scheme (FSCS). In other words, if the company behind the product fails or the crypto market crashes, there’s no government safety net.

The regulator’s U-turn is due to market maturity

This move is a sharp deviation from the ban that has been in place since 2021, when the FCA barred retail access to crypto derivatives and ETNs. At the time, the regulator stated that the volatility of the product and the high potential for investor losses were of major concern.

Since then, the crypto sector has come a long way. Major institutions, from BlackRock and Fidelity to Deutsche Bank and many institutional players, have entered the space, adding more credibility. New rules are also beginning to emerge with governments working to regulate the space, a notable example is the US, with its recent passage of the GENIUS Act.

Earlier this year, the FCA said it would no longer oppose exchanges creating dedicated markets for cETNs aimed at professional investors. A consultation in June 2025 explored the idea of letting retail clients in, too, and now that plan is becoming a reality.

Balancing innovation with risk

Despite the latest green light, crypto ETNs are still considered high-risk instruments.

But with the onus now on consumers to evaluate their own risk appetite, the FCA’s message remains clear: “Consumers should ensure they understand the risks before deciding to invest.”

The FCA shared that its ban on retail access to crypto derivatives is still in place; however, it will be monitoring market developments.

The regulator has a crypto roadmap as part of its effort to create a consistent digital asset regulatory regime.

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