ICYMI
- UK government looks set to introduce ransomware payment ban and mandatory reporting
- The UK Government's 10-year strategy for Financial Services: rewiring the financial regulatory system
- AML update: Key takeaways from the FCA's Monzo fine for failures in financial crime controls
- Cyber security: A month in retrospect (Australia) - July 2025
UK
FCA opens retail access to crypto ETNs
The FCA has announced that, from 8 October 2025, firms will be able to give retail consumers access to crypto exchange traded notes (cETNs). cETNs that retail consumers can access must be traded on an FCA-approved, UK-based investment exchange (a Recognised Investment Exchange or RIE). Financial promotion rules will apply so consumers get the right information and are not offered inappropriate incentives to invest.
The Consumer Duty will apply to firms offering these products to retail investors. However, they will not be covered by the Financial Services Compensation Scheme (FSCS).
The FCA's ban on retail access to cryptoasset derivatives will remain in place. The regulator stated that it will continue to monitor market developments and consider its approach to high-risk investments. [1 Aug 2025] #Crypto #DigitalAssets
FCA: Handbook Notice No 132
The FCA has published Handbook Notice No 130 which describes the changes to the FCA Handbook and other material made by the FCA Board. Among others, the instruments included in this edition cover enabling the sale, distribution and marketing of cryptoasset ETNs to retail clients where these crypto ETNs are admitted to trading on a UK Recognised Investment Exchange – the instrument comes into force on 8 October 2025. [1 Aug 2025] #Crypto #DigitalAssets
FCA sets out findings on design of digital acquisition journeys
The FCA has published its findings following its review of how firms acquire customers through digital channels and how they are delivering good customer outcomes in line with the expectations of the Consumer Duty. The regulator found that some lenders were using shorter, simplified language and providing explainer videos that helped customer understanding. However, the design of some digital loan processes lacked 'positive friction', which slows decision-making, and excluded information consumers needed, such as on costs.
The publication also sets out good practice and areas for improvement. The findings relate to consumer credit providers but apply to all regulated firms with a digital presence.
Alongside the findings, the FCA has published a research note on the impact of 'sludge' (ie unjustified frictions or actions that make an option less attractive to consumers) and deceptive design on financial decision making. Research notes do not necessarily represent the position of the FCA. [31 July 2025] #DigitalAcquisition #ConsumerDuty #DigitalLoans
FSCP: Response to consultation on prudential regime for crypto firms
The Financial Services Consumer Panel (FSCP) has published its response to the FCA's Consultation Paper 25/15: A prudential regime for cryptoasset firms (CP25/15) on proposed prudential rules and guidance for issuing qualifying stablecoins and the safeguarding of qualifying cryptoassets.
In general, the FSCP supports the the FCA's long-term vision to review and build a new integrated prudential framework. The FSCP highlights that 'it is urgent for all UK authorities and regulators to establish, agree, and communicate with clearly understood standard definitions of the various terms relevant to the cryptoasset sector'. It also expresses its concern that 'the FCA's efforts to apply regulation to cryptoassets currently appears to be fragmented and does not always give confidence that there is clarity around the holistic picture'.
The FSCP also sets out its thinking on certain capital requirements proposals in CP25/15, including: the composition of own funds; the concept of a permanent minimum requirement; the fixed overhead requirement; and the liquid assets requirement. It moreover encourages the FCA to further incentivise firms that are adhering to high standards with lower capital requirements. [31 July 2025] #Cypto
FSCP responds to consultation on stablecoin issuance and crypto custody
The FSCP has published its response to the FCA consultation (CP25/14) on proposed rules and guidance for the activities of issuing a qualifying stablecoin and safeguarding qualifying cryptoassets.
The FSCP states that it broadly supports the proposed regulatory framework and agrees that the Consumer Duty alone is insufficient to address the unique risks associated with stablecoins and cryptoasset custody. In particular, the FSCP welcomes the proposals to introduce clear obligations on redemption rights, asset backing, independent custody, segregation and transparency.
However, the FSCP believes there are several areas where further work is needed, including: prioritising the inclusion of payments activities within the regulatory framework; undertaking more direct consumer testing; clarifying the FCA's future supervisory role in relation to central bank digital currencies (CBDCs); addressing the ongoing importance of cash; and addressing the energy consumption associated with stablecoin operations. [31 July 2025] #Crypto #Stablecoins #CBDC
FCA: Wider Implications Framework annual report
The FCA has published the 2024/25 Wider Implications Framework annual report.
The framework provides a structure for its members – the FCA, the Financial Ombudsman Service (FOS) the Financial Services Compensation Scheme (FSCP), the Money and Pensions Service (MaPS) and the Pensions Regulator (TPR) – to work together to address issues that could have wider implications across the financial services industry. The report sets out how the members have worked together during the year; one of the highlights, among others was the implementation of the Payment Systems Regulator's (PSR's) authorised push payment (APP) fraud reimbursement requirement.
The report also discusses how collaboration between the members has produced better outcomes for consumers, firms and the financial services industry. It outlines changes made to enhance cooperation and engagement between members and stakeholders by updating the framework's terms of reference.
The members welcome feedback on their compliance with the cooperation duty and the annual report. [29 July 2025] #APPFraud
FSCP: Response to FCA consultation on lifting the ban on retail access to certain cETNs
The FSCP has published its response to the FCA's consultation (CP25/16) on lifting the ban on retail access to certain cETNs .
The Panel does not consider that the proposal to make UK Recognised Investment Exchange (UK RIE) cETNs available to retail consumers in the same way they are currently available to professional investors, is appropriate. It argues that retail consumers do not have the same level of resources, expertise, or risk tolerance as professional investors.
The Panel also remains concerned that spot cryptoasset markets, leveraged exchange traded products (ETPs), and crypto proxy investments continue to be available to retail consumers, despite often carrying greater risks than the regulated cETNs under consultation. [29 July 2025] #Crypto
PDP: Video on final step of connection to the pensions dashboards ecosystem
The Pensions Dashboards Programme (PDP) has published a video regarding the final step of the connection process to the pensions dashboards ecosystem for pension providers and schemes. The video explains both connection routes, either building a direct connection to the pensions dashboards ecosystem or connecting via a third-party connection provider. [29 July 2025] #PDP
Europe
ECB article: As stablecoins move from fringe to the mainstream, how could the EU respond?
The European Central Bank (ECB) has published a blog about stablecoins written by Jürgen Schaaf, an adviser on market infrastructure and payments at the ECB. Mr Schaaf writes in the context of observing how stablecoins have moved from the fringes to the mainstream relatively quickly. He observes that the US has taken a significant step in developing a regulatory framework, with the GENIUS Act signed into law by President Trump on 18 July. The Act, while 'broadly in line' with the EU's Markets in Cryptoassets Regulation (MiCAR), is more lenient in some areas. Mr Schaaf relates that market analysts project that stablecoin supply could grow from USD 230 billion in 2025 to USD 2 trillion by the end of 2028 as a result.
Mr Schaaf argues that a strategic response is required from the EU to prevent the erosion of monetary sovereignty and financial stability. Among the policy options the highlights are:
- providing greater EU-institutional support for properly regulated euro-denominated stablecoins;
- progressing the Eurosystem digital euro project and private sector innovations as complementary elements in a broader digital payment strategy;
- increasing the use of DLT in wholesale financial markets, particular across borders; and
- pursuing stronger global coordination on stablecoin regulation.
For more on the US GENIUS Act, please see our article here The Genius Act and other US legislative developments concerning cryptocurrency. [28 July 2025] #Stablecoins #MiCAR #DigitalEuro #CBDC
Hong Kong
HKMA publishes guidelines and explanatory notes for implementation of regime for stablecoin issuers on 1 August 2025
The HKMA has published the following ahead of the implementation of the new regulatory regime for stablecoin issuers on 1 August 2025:
- Consultation conclusions on the Guideline on Supervision of Licensed Stablecoin Issuers and the finalised guideline;
- Consultation conclusions on the Guideline on Anti-Money Laundering and Counter-Financing of Terrorism (For Licensed Stablecoin Issuers) and the finalised guideline;
- Explanatory Note on Licensing of Stablecoin Issuers on various aspects of the licensing regime and application process; and
The publication of the above was alluded to earlier in an inSight article by Mr Eddie Yue (HKMA Chief Executive) published on 23 July 2025 (see our previous update). The two guidelines have also been published in the Government Gazette.
Parties interested in applying for a licence are encouraged to contact the HKMA by 31 August 2025 so that the HKMA can communicate regulatory expectations and provide feedback as appropriate. While licensing will be an ongoing process, interested parties that consider themselves sufficiently ready and wish to be considered early should submit the application to the HKMA by 30 September 2025.
The HKMA reminds market participants that it is an offence under the Stablecoins Ordinance to falsely claim oneself as a licensee or an applicant. Market participants should exercise due caution in their public communications, as well as refrain from making statements that could be misinterpreted or create unrealistic expectations.
The public is reminded to stay vigilant and to refer to the HKMA's register of licensed stablecoin issuers to verify whether an issuer has been licensed. [29 Jul & 1 Aug 2025] #Stablecoins
SFST discusses recently launched Anti-Scam Consumer Protection Charter 3.0
In response to questions by the Honorary Chan Chun-ying in the Legislative Council, the Secretary for Financial Services and the Treasury (SFST), Mr Christopher Hui, discussed (among other things) the objectives and approach of the Anti-Scam Consumer Protection Charter 3.0, launched by the HKMA and other financial regulators in July 2025 (see our previous update).
Charter 3.0 expands participation to include technology and telecommunications firms, marking a new chapter of cross-sector collaboration among financial, technology and telecommunications industries in combating fraud. It aims to enhance effectiveness in four key areas:
- Reporting of suspected scams and fraud – Participating firms will put in place user reporting functions and establish direct and efficient channels for financial regulators to report and follow up on suspected scams and fraud.
- Vetting of advertisers – Participating firms will adopt a risk-based approach to verify advertisers, while developing internal policies and tools to monitor the advertisements and content on their platforms relating to financial products or services.
- Removal of fraudulent advertisements – Participating firms commit to enforcing their terms of service by detecting and removing financial scam advertisements or content that violate platform policies.
- Enhancing public awareness – Participating firms will collaborate with financial regulators and the financial industry to launch various anti-scam campaigns to raise public vigilance against scams.
Charter 3.0 covers major overseas and Mainland information technology platforms operating in Hong Kong (including instant messaging apps, social media, video streaming and search engine) as well as nearly all major telecommunications service providers (including fixed network operators, mobile network operators and internet service providers). Given the diversity of platforms and services, participating firms may adopt proportionate measures, based on their business scope and model, to comply with the Charter 3.0 principles. This approach allows them to leverage their tools and strengths to prevent scams and safeguard their users, and provide them with the flexibility to adapt to evolving tactics and patterns of scams, with a view to enhancing the capacity and effectiveness of Hong Kong's overall anti-scam ecosystem. [30 Jul 2025] #Scams #SocialMedia #InstantMessaging #Streaming
HKMA and HKAB hold Data Summit 2025, discussing latest developments in data initiatives
The HKMA and the Hong Kong Association of Banks (HKAB) have held the Data Summit 2025, themed 'Empowering business and trade through advanced data infrastructure'. The event was attended by 800 senior executives and professionals from almost 100 organisations, including government departments, banks, data specialists and partners of the Commercial Data Interchange (CDI).
The keynote addresses and panel discussions focussed on four key areas:
- Project Cargox: Six pilot banks have participated in the Transport and Logistics Bureau's new trial phase of the Port Community System, and they have preliminarily validated the effectiveness of using cargo data to verify trade authenticity. More innovative use cases are underway. In addition, the expert panel for the project has welcomed new members.
- Open Government data: The HKMA, the Government's Digital Policy Office (DPO) and the Commerce and Economic Development Bureau (CEDB) are working together on the planned connection with the CEDB's Trade Single Window Phase 3, which is targeted for roll-out in phases in 2026. This will enable users to authorise the sharing of their import and export declaration data with participating banks, with a view to expediting loan approvals. Separately, the DPO's Digital Corporate Identity (CorpID) Platform will launch progressively from the end of 2026, and the HKMA will explore its use for electronic signing in CDI to streamline the corporate authorisation process.
- Credit insights: The HKMA is advancing a proof-of-concept project on Commercial Credit Reference Agency (CCRA) 2.0, enabling the CCRA operator to build a corporate credit scoring model. Initial findings from the nine pilot banks indicate that the new model can effectively streamline the loan application process and reduce borrowing costs for SMEs.
- Cross-boundary data validation: The CDI has recently linked with the Shenzhen-Hong Kong cross-boundary data validation platform (see our previous update). Banks have connected to the new arrangement for the purposes of processing personal and corporate loan applications.
An opening speech was delivered by Mr Eddie Yue (HKMA Chief Executive), in which he addressed how data infrastructure promotes the physical economy, the core elements of advanced data infrastructure and how data infrastructure can enhance trade development. [28 Jul 2025] #Data
Singapore
ABS: Launch of EDP solutions
The Association of Banks in Singapore (ABS) has announced the launch of two new electronic deferred payment (EDP) solutions, known as EDP and EDP+ to support the transition to electronic payments. The solutions are accessible via banks' digital banking platforms and offer both individuals and companies a way to make deferred payments, or indicate an intent to pay, without the need for a physical cheque. [28 Jul 2025] #Payments #EDP #EDP+
Thailand
SECT partners with Meta on investment scam awareness campaign
The Securities and Exchange Commission Thailand (SECT) has announced that it is partnering with Meta on an investment scam awareness campaign. The aim is to educate consumers about prevalent online fraud tactics and improve digital safety. The campaign highlights four common scam types: cryptocurrency investment scams; romance scams; general investment scams; and celebrity impersonation scams. [31 Jul 2025] #Scams #DigitalSafety #Crypto
India
SEBI and MIIs launch campaign to combat scams
The Securities and Exchange Board of India (SEBI), in collaboration with a number of market infrastructure institutions (MIIs), has launched a joint media campaign titled 'SEBI vs SCAM'. The initiative aims to educate investors on prevalent scams, such as fake trading apps, unregistered investment advice from finfluencers, deepfakes, intermediary impersonation, paid trading courses promising guaranteed returns, and illegal 'dabba' and 'opinion' trading. [24 Jul 2025] #Scams #Finfluencers #Deepfakes
Philippines
BSP: EMEAP Governors' meeting
The Bangko Sentral ng Pilipinas (BSP) has published a summary of the 30th Executives' Meeting of East Asia-Pacific (EMEAP) Governors' meeting, held in Bangkok on 21 July 2025. The meeting unveiled a commemorative 'Look Back, Look Forward' report, which reviews EMEAP's notable accomplishments over the past 30 years.
The Governors also identified EMEAP's priority themes over the next three years, including, among others, rapid digitalisation and AI adoption. [29 Jul 2025] #AI #Digitalisation
US
SEC Chair Atkins on American leadership in digital finance
The Securities and Exchange Commission (SEC) has published the speech recently delivered by Chair Paul S. Atkins to the America First Policy Institute on U.S. leadership in digital finance. Chair Atkins set out his priorities as he launched "Project Crypto" to deliver to the President's vision of making the U.S. the crypto capital of the world.
Among these priorities are:
- Preparation of a regulatory framework;
- Modernizing SEC custody requirements;
- Allowing market participants to develop "super-apps" to enable securities intermediaries to offer a broad range of products and services via a single license;
- Enabling on-chain software systems – both decentralized and centralized – to interact with securities markets by updating "antiquated" requirements; and
- Fostering innovation, potentially via a new innovation exemption. [31 Jul 2025] #DigitalFinance #Crypto #DeFi #SuperApps
President's Working Group on Digital Assets Markets issues recommendations
The President's Working Group on Digital Asset Markets has released a report that provides a roadmap to deliver on the President's aim to make the U.S. the "crypto capital of the world". The recommendations cover:
- enabling the trading of digital assets at the federal level;
- creating a lasting framework for digital asset market structure;
- changes to the current regulatory framework;
- access to providing banking services;
- capital and other applicable regulatory treatment;
- innovation in payments;
- prohibiting central bank digital currencies (CBDCs);
- promoting the competitiveness of the U.S. dollar;
- improving anti-money laundering/countering the financing of terrorism (AML/CFT) and sanctions frameworks;
- equipping digital asset actors to mitigate risks;
- disrupting and mitigating systemic illicit finance risks;
- tax issues;
- cybersecurity;
- the repatriation/domestication of offshore foundations; and
- establishing a Bitcoin strategic reserve and U.S. digital asset stockpile.
The recommendations detail the actions to be taken by legislators and the regulatory agencies. A factsheet accompanies the 166 page report.
The Working Group was established by President Trump's Executive Order 14178 and consists of officials throughout the Federal government; it was tasked with submitting a report that recommends regulatory and legislative proposals to advance the policies established in the Order.
Statements on the report have been issued by:
- Treasury Secretary Scott Bessent;
- SEC Chair Paul Atkins; and
- Acting CFTC Chair Pham. [30 Jul 2025] #DigitalAssets #CBDC #AML #Cyber #Risk #Bitcoin
SEC permits in-kind creations and redemptions for crypto ETPs
The SEC has voted to approve orders to permit in-kind creations and redemptions by authorized participants for cryptoasset exchange-traded product (ETP) shares.
This reflect a departure from recently approved spot bitcoin and ether ETPs, which were limited to creations and redemptions on an in-cash basis. With these approval orders, bitcoin and ether ETPs, consistent with other commodity-based ETPs approved by the SEC, will be permitted to create and redeem shares on an in-kind basis.
Additionally, approval was given for other orders that advance a merit-neutral approach to crypto-based products, including exchange applications seeking to list and trade an ETP that would hold mixed spot bitcoin and spot ether, options on certain spot bitcoin ETPs, Flexible Exchange (FLEX) options on shares of certain BTC-based ETPs, and an increase of position limits up to the generic limits for options (up to 250,000 contracts) for listed options on certain BTC ETPs. Also, the Commission issued two scheduling orders soliciting comments in support of, or in opposition to, the Division of Trading and Market's approval, pursuant to delegated authority, of a national securities exchange's proposals to list and trade two large cap crypto-based ETPs. [30 Jul 2025] #Crypto
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