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The Financial Conduct Authority published policy statement PS26/7 on April 30, 2026, formally clearing the path for UK asset managers to run fund registers on distributed ledger networks.
The same week, HM Treasury released a draft statutory instrument that removes UK-issued stablecoins from key FCA dealing requirements, the most significant double move on digital finance infrastructure the UK has made in a single week.
The UK just made tokenized funds part of the rulebook. 🇬🇧
The Financial Conduct Authority has signed off on new rules allowing UK asset managers to maintain fund registers on blockchain and introducing a "Direct-to-Fund" dealing model for onchain settlement.
The policy… pic.twitter.com/1gt1ySCNp1
— Irregulated (@irregulatedHQ) May 1, 2026
The FCA’s policy statement PS26/7 does three specific things. First, it confirms that UK authorized funds can maintain their investor registers on distributed ledger technology, including on public blockchain networks, provided controls meet FCA standards. That means onchain transaction records can serve as the primary books for unit deals without requiring a full off-chain duplicate, as long as fund managers maintain appropriate resiliency plans.
Second, it formalizes the industry Blueprint model, which has already been used to authorize the first tokenized UK UCITS fund. Units can be issued across multiple blockchains simultaneously so long as investors’ rights and charges are consistent across all chains.
Third, the FCA confirmed it remains open to granting waivers so that funds can use digital cash and stablecoins for settlement and certain expenses, a door it explicitly declined to close while it works through how stablecoin settlement should function at scale inside the broader regime.
Simon Walls, executive director of markets at the FCA, stated the regulator’s position directly: ‘Tokenization will play an important role in asset management, and we have delivered a practical framework to give firms confidence in how fund tokenization can operate within the FCA’s rules.’ The statement arrives after the FCA opened a parallel consultation covering stablecoin issuance, trading, custody, and staking, ahead of a full cryptoasset authorization regime due to take effect in October 2027.
Published April 21, the HM Treasury draft statutory instrument amends the Financial Services and Markets Act 2000 (Cryptoassets) Regulations 2026 in a way that directly reduces friction for stablecoin payment firms.
The primary amendment removes UK-issued qualifying stablecoins, referred to throughout government documents as UKQS, from the regulated activities of dealing in qualifying cryptoassets as principal, dealing as agent, and arranging deals in qualifying cryptoassets, as defined in regulations 9I, 9J, and 9K of the existing statutory instrument.
The practical consequence is that firms providing stablecoin payment services using a UKQS will no longer need to seek FCA authorization specifically for those dealing and arranging activities when the application gateway opens in September 2026. Firms still require safeguarding permissions if they hold or manage client assets, and UKQS lending and borrowing remains inside the dealing perimeter so the FCA retains rulemaking authority over the consumer risk that borrowing against stablecoins carries.
The SI also turns on early the provisions that remove UKQS backing assets from classification as collective investment schemes or alternative investment funds, a technical but consequential change that had been blocking several stablecoin use cases in collateral management and tokenised asset markets before the full regime takes force.
The FCA’s tokenized fund rules and the HM Treasury dealing carve-out are each individually constructive, but they exist in tension with Bank of England proposals that industry lawyers and the FCA’s own sandbox firms have warned are commercially unworkable.
The Bank of England’s consultation on systemic sterling stablecoins proposes a £10 million cap on business holdings for any stablecoin that becomes widely used in payments and is therefore designated systemic.
Coinbase vice president of international policy Tom Duff Gordon gave evidence to the House of Lords Financial Services Regulation Committee stating the problem plainly: a £10 million holding cap is a structural barrier for tokenized gilt settlement, cross-border institutional payments, and wholesale collateral management, which are the use cases that would make a sterling stablecoin commercially meaningful to institutional markets.
A stablecoin that cannot be held at institutional scale is not a settlement instrument. Monee Financial Technologies, one of the four FCA sandbox firms, is simultaneously inside the Bank of England‘s Digital Securities Sandbox, making it the only company operating in both programs at once. Its commercial model only functions if the two regimes end up pointing in the same direction. As of this week, they do not.
The FCA’s published crypto roadmap sets September 2026 as the date the authorisation application gateway opens, with the full regime going live in October 2027.
The four stablecoin cohort firms selected from twenty applications, Revolut, Monee Financial Technologies, ReStabilise, and VVTX, began testing in Q1 2026 under existing permissions.
Revolut brings the largest installed base with more than 60 million customers and a GBP-denominated stablecoin designed for payments, custody, and transfer.
Outside the sandbox, Agant secured FCA cryptoasset registration in February 2026 and is preparing to issue GBPA, a fully backed sterling stablecoin targeting institutional payments and tokenised asset settlement across Ethereum and Solana.
BCP Technologies, whose tGBP was listed on Coinbase in April, was the first GBP stablecoin to reach a major global exchange. HM Treasury confirmed it will consult on broader payment services reform in Q2 2026, at which point stablecoin payment services are expected to migrate out of the crypto regime entirely and into a new regulated payments perimeter, which would further clarify how the dealing carve-out interacts with the incoming rules.
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