UK’s FCA to Allow Retail Investors Limited Access to Crypto ETNs
The UK’s Financial Conduct Authority (FCA) will permit retail investors to access certain crypto asset-backed exchange-traded notes (cETNs) for the first time since a 2021 ban, the regulator announced today. The decision follows a consultation launched in June 2025 and applies only to products traded on FCA-approved, UK-based recognised investment exchanges. Under the updated rules, cETNs must be listed on a recognised investment exchange such as Cboe or the London Stock Exchange. Financial promotion requirements will apply, obligating firms to provide clear information and avoid offering inappropriate incentives. The Consumer Duty, which sets standards for how financial firms treat customers, will also apply. However, the FCA stressed that investments in cETNs will not be protected by the Financial Services Compensation Scheme (FSCS). “Consumers should ensure they understand the risks before deciding to invest,” the regulator said. Protections and Restrictions Remain in Place The FCA said the move reflects changes in the crypto market since 2021, when it prohibited the sale, marketing, and distribution of cryptoasset derivatives and ETNs to retail clients. According to David Geale, the FCA’s executive director of payments and digital finance, cETNs have become “more mainstream and better understood,” prompting the regulator to expand access while keeping safeguards in place. The regulator emphasised that the ban on retail access to cryptoasset derivatives will remain. The FCA will also continue to monitor the market for high-risk investments and adjust its approach if needed. Part of a Broader UK Crypto Regulatory Framework The decision forms part of the FCA’s wider effort to develop a regulatory framework for cryptoassets. Earlier this year, the authority published proposals on stablecoins and outlined a broader crypto regulatory roadmap. Recognised investment exchanges seeking to list cETNs must meet UK recognition requirements, which include ensuring equivalent investor protection. These recognition orders are granted under the Financial Services and Markets Act 2000. The FCA first signalled a possible policy shift in March 2024, when it said it would not oppose requests from recognised investment exchanges to create UK-listed cETN markets for professional investors. The June 2025 consultation marked the first formal step toward reintroducing retail access. While the change offers UK retail investors a new avenue for crypto-related investments, regulators maintain that the products carry significant risks, and investors are urged to proceed with caution.
