- FCA will let retail investors access cETNs only through approved UK-based exchanges.
- Crypto derivatives will still remain banned for retail users under the current rules.
- All firms must follow promotion rules and provide clear risk information to customers.
The UK’s Financial Conduct Authority (FCA) will allow retail investors to trade crypto exchange-traded notes (cETNs) beginning October 8, 2025. The change follows a market consultation in June and introduces a cautious entry point into crypto for retail participants while keeping derivative access restricted.
This decision comes more than three years after the FCA imposed a ban on crypto ETNs and derivatives due to concerns about consumer risk and asset volatility. Since January 2021, these products have been considered unsuitable for retail investors, primarily due to unpredictable market behavior and a lack of consumer understanding.
Retail access will be granted only to cETNs listed on Recognized Investment Exchanges (RIEs), not through unregulated channels. According to the FCA’s official statement, the move responds to market developments, rising product maturity, and increasing investor familiarity.
FCA Responds to Market Evolution
David Geale, executive director of payments and digital finance at the FCA, noted in the announcement that the crypto market had matured significantly. “Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood,” he said in a statement on Friday.
He added, “In light of this, we’re providing consumers with more choice, while ensuring there are protections in place. This should mean people get the information they need to assess whether the level of risk is right for them.”
The FCA’s decision aligns with a broader push to provide safer, structured entry into digital assets, without fully lifting regulatory safeguards. Firms must follow the FCA’s financial promotion rules and ensure compliance with the Consumer Duty standards. These rules require all firms to cooperate with the needs of clients thus preventing unprecedented risks. The Financial Services Compensation Scheme will not apply to crypto ETNs. Investors are expected to bear any losses independently and must understand the risks before investing.
Limited Relaxation Still Excludes Derivatives
Despite easing access to crypto ETNs, the FCA has confirmed that its ban on cryptoasset derivatives remains in force. This selective policy marks a measured opening—offering retail exposure through structured instruments while still excluding complex products.
The regulator will maintain a close attention on the market. In its roadmap, the FCA already made proposals on stablecoins and custody frameworks in order to create the full structure of crypto oversight.
This approach aims to protect investors while exploring controlled innovations in digital finance. The FCA’s stance seeks to strike a clear balance—providing broader market participation but not at the cost of regulatory caution.
To prevent consumer missteps, only FCA-recognized exchanges will be permitted to offer cETNs. Any firm involved must also implement appropriateness testing to verify that the product suits each investor’s knowledge and experience.
Related: FCA Clears BlackRock for Crypto Asset Services in the UK
Is the UK Setting the Tone for Europe?
Could the FCA’s calculated approval of cETNs set a benchmark for crypto regulation across Europe? Some analysts suggest the UK may be positioning itself as a controlled testing ground for retail crypto integration. Similar products are already offered to retail investors in countries like Germany and Switzerland, where risk frameworks have supported access for some time.
This ruling is a continuation of the FCA regulatory roadmap. In addition to stablecoins and custodians, there will be new digital asset guidelines expected within the next few months by the regulator, which will also define the future of crypto in the UK.
With such a cautious move, the FCA portrays an intention of harmonizing with the changing digital asset landscape without falling off the track in terms of control and safeguarding investors.
