UK FCA Opens Doors for Retail Crypto ETNs Starting October 2025

• Retail access to crypto ETNs begins October 8, 2025, on FCA-approved UK exchanges.
• No FSCS protection applies, with 70% of crypto investors facing losses per 2023 data.
• Crypto derivatives ban remains, prioritizing investor safety amid market volatility.

The UK Financial Conduct Authority (FCA) has announced a significant shift in its cryptocurrency regulatory framework, permitting retail investors to access crypto Exchange Traded Notes (cETNs) starting October 8, 2025.

This decision, detailed in a June 2025 consultation, reverses a 2021 ban on crypto derivatives and ETNs for retail clients, reflecting the evolving market landscape. The move comes as cETNs have gained mainstream traction globally, with frameworks like the EU’s MiCA regulation influencing the FCA’s approach. However, these products will only be available through FCA-approved UK exchanges, such as the London Stock Exchange, ensuring a controlled environment.

While this development offers retail investors more investment choices, it comes with notable risks. cETNs will not be covered by the Financial Services Compensation Scheme (FSCS), which protects up to £85,000 in case of firm failure. A 2023 FSCS report revealed that 70% of crypto investors lost funds due to platform collapses, underscoring the high-risk nature of these assets. The FCA has emphasized that the Consumer Duty will apply, mandating firms to provide clear information and avoid inappropriate incentives, helping investors assess whether the risk aligns with their financial goals.

Importantly, the ban on crypto derivatives remains intact, a decision rooted in a 2020 FCA study linking their volatility to substantial retail losses. This cautious stance highlights the regulator’s focus on investor protection amid industry calls for broader market access. David Geale, executive director of payments and digital finance at the FCA, noted that the market’s evolution justifies this step, balancing choice with safeguards. The FCA will continue monitoring developments to refine its crypto regulatory framework, which also includes recent proposals on stablecoins.

As the UK positions itself as a competitive hub for crypto innovation, this policy shift marks a pivotal moment. Investors are urged to thoroughly understand the risks, given the absence of FSCS coverage and the inherent volatility of crypto markets.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.