UK's Financial Conduct Authority regulate security and utility tokens

Britains’ financial regulator, the Financial Conduct Authority (FCA), will not regulate Bitcoin (BTC) as a part of its recent guidance on crypto assets. On July 31, the FCA issued its finalized policy statement on cryptocurrencies in a documenttitled “PS19/22: Guidance on Cryptoassets.” The document represents an updated version of a consultation paper on crypto assets that was first released for public comment in January 2019, and intends to bring more regulatory clarity to existing types of digital assets.

In the document, the FCA considered major cryptocurrencies such as Bitcoin and Ether (ETH) as “exchange tokens,” describing them as types of crypto assets that are “usually decentralized and primarily used as a means of exchange.” The regulator emphasized that such digital currencies do not fall under the regulatory scope of the FCA and is outside its remit.

Two other types of digital assets, including security tokens and utility tokens, do fall under the regulatory perimeter or may be regulated in some sense, the FCA wrote.