CMS Expert Guide to Crypto Regulation

This Expert Guide provides an overview of cryptoasset regulation in the EU, the UK, and in other jurisdictions across the world. We have summarised the regulations applicable to the main activities performed by cryptoasset service providers, as well as the requirements of any licensing regimes in that jurisdiction (including time and cost of such). Our aim is to provide information which is both legally accurate and a practical aid for decision-making. If you require further advice in any of these jurisdictions, please reach out to us or direct to the relevant lawyers (contact details provided).

In the UK, cryptoassets and cryptoasset services have thus far been regulated by piecemeal legislation, which expanded the existing anti-money laundering (“AML”) and financial promotions regimes to include service providers either based in the UK or promoting to UK customers respectively. However, since 2024, the UK government and the Financial Conduct Authority (“FCA”) have begun to introduce and consult on a wide-ranging suite of new rules, which collectively bring cryptoassets and related services into the scope of the existing financial services regime in the UK by either updating existing rules or introducing new rules. Additionally, the UK has also opened a “digital securities sandbox”, where various crypto-related businesses can trial their operating models in a regulatory sandbox with close communication with the FCA. We explore both the incoming and existing regimes in the UK page of the Expert Guide.

In the EU, prior to 2024, the regulation of cryptoassets and related services were mostly implemented by member states, and were primarily related to AML. However, the Regulation on Markets in Crypto Assets (“MiCA”) has since been published, and is the first EU-level piece of legislation that introduces a comprehensive framework for cryptoassets and services, covering everything from the issuance, trading, and custody of cryptoassets, to the conduct and market abuse standards expected of firms in the EU. However, the implementation the various regimes under MiCA will be staggered, and the patchwork of national regulations in the EU will continue to present a challenge for some time. For more information about MiCA regulations and insights from our experts, please visit the following link to access a collection of articles: Legal experts on Markets in Crypto-Assets (MiCA) regulation. For more information on crypto tax, please visit CMS Expert Guide on Taxation of Crypto-Assets (Crypto Tax). 

In addition to contributions from our colleagues at CMS, this Expert Guide contains the work of lawyers from other leading firms.