In December 2025, the FCA released three consultation papers regarding the next steps for shaping the UK’s Cryptoasset Rules.
- CP 25/40 – CP25/40: Regulating Cryptoasset Activities
- CP 25/41 – CP25/41: Regulating Cryptoassets: Admissions & Disclosures and Market Abuse Regime for Cryptoassets
- CP 25/42 – CP25/42: A prudential regime for cryptoasset firms
These rules cover a range of topics including: Admissions and Disclosures; Market Abuse; Cryptoasset Trading Platforms; Intermediaries; Staking & Prudential Requirements.
For ISLA Members, the most relevant rules are in CP 25/40, Chapter 5, which covers cryptoasset lending and borrowing referred to as ‘Crypto L&B.
These rules include:
- Decentralised finance (DeFi) – DeFi allows trading and lending and borrowing using crypto without an intermediary. The FCA are enquiring if the same rules that apply in traditional finance should also apply here.
- Lending and borrowing – Rules to protect both crypto lenders and borrowers.
ISLA will be engaging with our Regulatory Steering & Digital Steering working groups to discuss the response to CP 25/40 in particular, which has a deadline of 12 February 2026.
