UK FCA Proposes 10% Crypto ETN Limit for Some Retail Funds
The U.K. Financial Conduct Authority proposed allowing certain retail investment funds to hold up to 10% of their assets in crypto exchange-traded notes. The move would expand access to crypto-linked products through regulated, pooled investment structures while keeping exposure capped.
What happened?
The U.K. Financial Conduct Authority proposed allowing certain retail investment funds to hold up to 10% of their assets in crypto exchange-traded notes. The move would expand access to crypto-linked products through regulated, pooled investment structures while keeping exposure capped.
Why it matters
The development matters because it would give retail-facing pooled investment products a limited path to crypto ETN exposure inside regulated fund structures. UCITS and NURS are open-ended vehicles that pool retail investor money into managed portfolios, broadly comparable to mutual funds in the U.S.
The U.K. Financial Conduct Authority has proposed allowing certain retail investment funds to allocate up to 10% of their assets to cryptocurrency exchange-traded notes, according to CoinDesk. The proposal applies to UCITS schemes and some non-UCITS retail schemes, known as NURS.
The development matters because it would give retail-facing pooled investment products a limited path to crypto ETN exposure inside regulated fund structures. UCITS and NURS are open-ended vehicles that pool retail investor money into managed portfolios, broadly comparable to mutual funds in the U.S.
The FCA framed the 10% threshold as a risk control. In its consultation paper, the regulator said the proposed limit would help reduce the risk of significant effects from crypto ETN exposure within these funds.
The proposal follows a broader shift in the U.K.'s approach to crypto exchange-traded products. The FCA first allowed retail investors to access such products in October 2025, after lifting a ban that had been in place since 2021.
Crypto-linked investment vehicles are designed to provide exposure without requiring investors to buy or custody the underlying digital assets directly. CoinDesk noted that regulatory barriers to broader use of these products in the U.K. have drawn criticism from commentators who argue the country risks falling behind peers.