UK to Lift Ban on Crypto ETNs for Retail Investors Starting October 8, 2025
The UK's Financial Conduct Authority (FCA) is set to lift its ban on crypto exchange-traded notes (ETNs) for retail investors, effective October 8, 2025. This decision marks a significant shift, allowing BTC products to return to the UK market after a two-year hiatus.
FCA's Rationale for Lifting the Ban
The FCA explained that the decision was influenced by the evolution of the crypto market. According to David Geale, executive director of payments and digital finance at the FCA, these products have "become more mainstream and better understood." The move aims to provide consumers with more choice while ensuring adequate protections are in place, enabling them to make informed decisions about the risks involved.
“Since we restricted retail access to cETNs, the market has evolved, and products have become more mainstream and better understood. 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.”
Clarification on Crypto ETFs
Despite lifting the ban on ETNs, the FCA clarified that exchange-traded funds (ETFs) marketed to UK retail investors are currently unable to invest directly in cryptoassets. The FCA stated that its current regulatory framework for funds would need to be updated before retail investors can access cryptoasset ETFs. This means while ETNs are returning, crypto ETFs face a longer regulatory path.
Industry Reaction and Potential Offerings
Companies like Bitwise, registered in the UK, have expressed excitement about the opportunity to serve more investors in their home market in Europe. On October 3, 2025, Bitwise took to X to celebrate. BlackRock is reportedly exploring options for making its iShares Bitcoin exchange-traded product available to UK retail investors. CryptoUK's Ian Taylor commended the decision, noting that the UK had been "an outlier on ETNs."
Speculation and Application Review Processes
Speculation suggests that CoinShares and Bitwise are preparing to launch new offerings. However, retail investors may need to wait at least a week due to the FCA's application review processes. The crypto community, particularly in the UK, has largely celebrated the reversal of the ban on social media platforms like X.
Crypto Passporting: A New Frontier in Financial Regulation
The article also touches upon the concept of "crypto passporting," similar to the European Union's framework for financial services companies. The idea is to allow crypto companies regulated in one country, like the US, to operate in another, like the UK, without undergoing full authorization processes. This aims to reduce barriers to international expansion, which currently include significant costs and delays for companies trying to expand globally.
Adrienne Harris has been a strong advocate for a US-UK passporting scheme to facilitate easier cross-border operations for crypto businesses.
