UK Advances Plan to Regulate Bitcoin and Digital Assets by 2027

TLDR

• UK Treasury plans crypto regulation aligned with financial products by 2027

• FCA to gain expanded powers beyond current AML supervision

• Consumer protection and transparency remain central policy goals

• Digital assets recognized as property under 2025 legislation

The UK government has confirmed plans to regulate Bitcoin and crypto assets by 2027.
The Treasury aims to bring digital assets under a formal financial framework.
Officials say the move responds to the sector’s rapid growth across investments and payments.

The proposal would treat crypto assets more like established financial products.
This approach forms part of a broader plan to modernise financial oversight.
The government stated that clearer rules are needed as crypto adoption increases.

The announcement follows rising calls to close gaps in oversight.
Policymakers say digital assets now play a growing role in the financial system.
This has increased pressure to strengthen regulatory clarity and enforcement.

UK FCA to Take a Central Supervisory Role

The Financial Conduct Authority would gain expanded authority under the new regime.
The FCA would supervise crypto firms operating within the UK.
This marks a change from the current limited oversight structure.

At present, FCA involvement focuses mainly on anti-money laundering controls.
Crypto firms must follow know-your-customer rules and report suspicious activity.
The Treasury said this approach does not cover broader market risks.

Under the new framework, crypto services would face consistent supervision.
Officials said this alignment supports fairness across financial markets.
The goal is to integrate crypto services into existing regulatory standards.

Consumer Protection and Market Integrity Remain Core Goals

Consumer protection was cited as a key driver of the proposed legislation.
Officials noted that crypto assets lack safeguards found in traditional investments.
This gap has left users exposed to higher risks.

The Treasury stated that clearer standards would improve transparency.
Better disclosure rules are expected to support informed decision-making.
Authorities believe this could improve trust in regulated crypto services.

Market integrity also remains a focus of the reforms.
Regulators aim to improve detection of suspicious transactions.
They also plan stronger enforcement against firms that break the rules.

Government Links Regulation to Economic Strategy

Chancellor Rachel Reeves linked crypto regulation to long-term economic planning.
She said clear rules help businesses invest and create skilled jobs.
Her statement framed regulation as part of securing digital finance growth.

“By giving firms clear rules of the road, we are providing certainty,” Reeves said.
She added that the approach would strengthen consumer protections.
Officials also said it would limit access for non-compliant actors.

City Minister Lucy Rigby echoed this position.
She said consistent regulation supports sustainable business planning.
Her comments stressed stability rather than short-term market gains.

Timeline and Legislative Background

The government confirmed the framework is scheduled for 2027.
Further legislative steps are expected before implementation.
Officials said industry engagement will continue during this period.

The move follows the Property (Digital Assets etc.) Act 2025.
That law recognized digital assets as a form of legal property.
It laid the groundwork for broader regulatory treatment of crypto assets.

The FCA is also developing rules for sterling-pegged stablecoins.
The agency plans to support payment trials through a regulatory sandbox in 2026.
These efforts run alongside the wider crypto regulation strategy.

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