The UK’s Monetary Conduct Authority (FCA) has lifted the ban on retail entry to cryptocurrency exchange-traded notes (cETNs).
Corporations within the UK will quickly be capable to provide retail shoppers cETNs, with regulatory adjustments efficient from Oct. 8, 2025, in keeping with an official FCA announcement on Friday.
The brand new growth within the UK’s regulatory method on crypto comes years after the FCA banned crypto ETNs in January 2021, citing the acute volatility of crypto property and a “lack of legit funding want” for retail shoppers.
“Since we restricted retail entry to cETNs, the market has advanced, and merchandise have grow to be extra mainstream and higher understood,” David Geale, FCA government director of funds and digital finance, mentioned within the announcement.
What are crypto ETNs?
In contrast to cryptocurrency exchange-traded funds (ETFs), which observe the worth of underlying property like Bitcoin (BTC) in custody, crypto ETNs will not be backed by any underlying property and characterize debt securities.
“As a substitute of fairness within the fund, every traded observe of an ETN represents an obligation from a authorized entity holding the underlying asset as collateral,” in keeping with the ETN description by the Austrian crypto buying and selling platform Bitpanda.
By investing via an ETN monitoring crypto, buyers can receive publicity to bodily crypto property through their common brokers or banks.
ETNs are related to dangers like restricted management over their property, which underscores the significance of buying ETNs from respected establishments to make sure security, Bitpanda mentioned.
Crypto derivatives nonetheless banned
Whereas permitting crypto ETNs, the UK FCA is but to decide on whether or not to permit retail buyers to entry crypto derivatives, which the authority banned alongside ETNs in 2021.
“The FCA will proceed to watch market developments and think about its method to high-risk investments,” the regulator said.
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Crypto derivatives, or merchandise equivalent to crypto futures, choices and perpetual contracts, have proven resilience within the second quarter of 2025, with volumes netting $20.2 trillion, in keeping with the crypto analytics platform TokenInsight.
In distinction, centralized exchanges’ (CEXs) volumes plummeted by 22%, displaying an enormous distinction to cryptocurrency ETFs.
US permits in-kind for crypto ETFs: No impression on retail
Cryptocurrency ETFs have seen exceptional development since their historic launch within the US in 2024, with issuers like BlackRock posting a 370% surge in inflows in Q2 2025 and crypto funds breaking a number of information.
On Tuesday, the US SEC delivered one other essential determination on crypto ETFs, formally authorizing issuers to proceed with in-kind creations and redemptions or to trade ETF shares for the underlying crypto property.
Though the transfer is basically seen as large information for the crypto business, ETF analysts like Eric Balchunas say that the occasion will seemingly have little to no impression on retail buyers.
“It’s not a big impact to retail however extra of a plumbing repair. It simply makes the pipes slightly higher,” Balchunas mentioned in an X submit on Tuesday. The largest takeaway from the milestones is that the SEC is able to deal with crypto like a legit asset class, he added.
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