Regulated Access Returns to the UK Market
The UK’s Financial Conduct Authority (FCA) has reversed its four-year ban on crypto exchange-traded notes (cETNs), allowing retail investors to gain exposure to bitcoin and ether through regulated platforms. The move, effective from October 8, 2025, marks the regulator’s most significant shift in digital asset policy since 2021 and could reshape how traditional investors access crypto markets.
The FCA said the decision reflects an evolving market with “more mainstream and better understood” products. “We’re providing consumers with more choice, while ensuring there are protections in place,” stated David Geale, the FCA’s executive director for payments and digital finance. However, the agency emphasized that losses from these instruments will not be covered by the Financial Services Compensation Scheme.
How the New ETNs Will Work
Crypto ETNs are exchange-traded debt instruments that mirror the price of underlying assets, such as bitcoin or ether. They trade on recognized exchanges like the London Stock Exchange (LSE), allowing investors to buy and sell them just as they would with traditional securities.
These instruments are designed for investors seeking exposure without directly holding crypto or managing digital wallets. While ETNs reduce custody risks, they come with other market hazards—issuer default, liquidity gaps, and price tracking differences remain real concerns.
Market Reactions: From Excitement to Caution
Financial platforms have responded swiftly but cautiously. Interactive Investor and Saxo confirmed they will support the first ETN products expected to list around October 13, once final approvals are cleared. AJ Bell said it is reviewing potential offerings.
In contrast, Hargreaves Lansdown, the UK’s largest retail platform, warned that “bitcoin has no intrinsic value,” stressing that crypto remains unsuitable for most long-term portfolios. The company said it will delay adding crypto-linked products until next year and only under stricter client assessments.
This split reflects the broader mood in British finance—eager to innovate, but still wary of crypto’s volatility and reputation risks.
London’s Bid to Stay Competitive
The policy change positions the UK closer to the European Union and United States, where crypto exchange-traded products have already attracted billions in inflows. London, which has seen much of its financial innovation shift offshore, now aims to reclaim its role as a regulated global hub for digital assets.
Still, the FCA insists this is not a deregulation moment. The ban on crypto derivatives for retail remains, and every firm offering ETNs must comply with the FCA’s Consumer Duty standards—ensuring that marketing is fair, transparent, and suitable for the audience.
The FCA also warned that investors must not expect any safety net: “Consumers should only invest what they can afford to lose.”
What It Means for Retail Investors
For the everyday investor, the introduction of cETNs means crypto exposure could soon appear on familiar brokerage dashboards. The new products could also become eligible for tax-efficient wrappers in the future, depending on HMRC guidance.
Industry analysts expect the first wave of ETNs to focus on bitcoin and ether, before expanding into diversified crypto baskets or yield-based structures. If uptake is strong, the UK could see a gradual normalization of digital assets within regulated investment channels.
The Bottom Line
The FCA’s move signals cautious optimism rather than unrestrained enthusiasm. It provides a legal pathway for crypto integration into traditional finance—without pretending that crypto is risk-free.
For now, London’s message is clear: the UK isn’t declaring crypto safe, but it is declaring it supervised.
Keynotes:
- FCA reverses its 2021 ban, allowing retail investors access to crypto ETNs
- Consumer Duty rules apply; no investor protection under FSCS
- Major brokers like Interactive Investor and Saxo preparing listings
- Hargreaves Lansdown urges caution, delaying its rollout until 2026
- Launch aligns UK policy closer to the EU and US regulatory frameworks