BTC $80,392 
ETH $2,329 
USDT $0.9992 
BNB $737.82 
XRP $1.29 
USDC $0.9997 
SOL $101.22 
TRX $0.3301 
FIGR_HELOC $1.06 
ZEC $1,226 Regulation · Explained
FCA consults on crypto crime guidance covering wallet checks and analytics
The non-binding proposals set out good and poor practice for customer checks, blockchain analytics and the Travel Rule, with responses due by 24 December.
Key takeaways
- Personal wallets. Draft text lists enhanced due diligence on transfers involving unhosted wallets as an example of good practice.
- Vendor scores. Firms that cannot explain or evidence the basis of third-party analytics findings are held up as poor practice.
- No new rules. The FCA says the guide imposes no new requirements, though it expects firms to consider it when building controls.
What happened
The Financial Conduct Authority has opened a consultation on revisions to its Financial Crime Guide, with cryptoasset businesses among the firms in scope. Consultation paper CP26/38, published on 23 October, proposes examples of good and poor practice for how firms assess customers and transactions and how they respond when risk changes. Responses are due by 24 December 2026.
Cryptoassets appear in the draft alongside fraud, sanctions, data security and money laundering. The proposals apply to the FCA's financial crime supervisory population, which includes cryptoasset businesses and firms supervised under the Money Laundering Regulations. The draft addresses the use of blockchain analytics and adds further guidance on the Travel Rule, which governs information that accompanies certain transfers.
One draft provision, numbered FCG 3.2.8, treats enhanced due diligence on transfers involving unhosted, or personal, wallets as an example of good practice. Another, FCG 3.2.5, identifies as poor practice using third-party technology without being able to explain or evidence the basis of its findings or scoring. The same section criticises rigid rules on how many transfer steps, or "hops," a firm examines when those limits fail to take risk into account.
The paper also reminds firms that governance should develop as their businesses grow, and asks whether policies and staff training distinguish obligations under proceeds-of-crime legislation from those under terrorism legislation.
Why it matters
For exchanges and custody providers, the practical message is that licensing a screening product is only one part of compliance. Someone still has to set thresholds, review alerts and record the reasoning behind decisions. A warning that is technically accurate has limited value if nobody acts on it while funds move on. The draft makes a similar point about stablecoin transfers: a stable unit price says nothing about who sent funds or where they came from, so transaction risk and market risk need to be treated as separate questions.
The guidance would be non-binding. The FCA says the guide contains no rules and imposes no new requirements, and departing from it would not by itself establish a breach. Firms are nonetheless expected to read and consider it when setting up controls, which makes the examples a useful signal of how supervisors may judge those controls later.
What the data shows
The consultation opened on 23 October 2026 and closes on 24 December 2026. It carries the reference CP26/38 and cites draft sections FCG 3.2.8 and FCG 3.2.5. The FCA says it does not expect the updates to materially increase compliance activity or consumer costs, or to materially change firms' products and services, describing them as clarifications of existing expectations and established practice. After the deadline, the regulator plans to publish feedback and the final guide text in a policy statement.
Background
Parts of the regime are already in force. Under the UK Travel Rule, cryptoasset businesses have had to collect, verify and share transfer information since 1 September 2023, and the FCA says firms remain responsible for compliance when they use third-party suppliers. Separately, the regulator's overview of the wider cryptoasset framework says that regime is expected to begin on 25 October 2027. Applications for authorisation are already open, and a package of final rules was published in June.
The consultation does not suspend existing anti-money-laundering duties or bring the future regime into force early. It sets out proposed guidance that firms could use when turning those obligations into day-to-day decisions.
What to watch
The consultation does not give a date for that policy statement, so the timing of the final text is open. Also worth following is how the FCA frames hop limits and third-party scoring once responses are in, since the draft targets rules and scores that ignore risk rather than numerical limits as such. How the guidance sits alongside the 2027 authorisation regime will matter for firms budgeting compliance work now. NewsBTC and CryptoSlate both reported the proposals.
Questions readers ask
Would the guidance create new obligations for crypto firms?
No. The FCA describes the guide as containing no rules and imposing no new requirements, and says departing from it would not by itself amount to a breach. It is intended to show supervisory expectations.
What does it say about personal wallets?
Draft section FCG 3.2.8 gives enhanced due diligence on transfers involving unhosted wallets as an example of good practice, focusing on how a receiving firm checks such a transfer.
When does the wider crypto regime start?
The FCA's regime overview points to 25 October 2027, with authorisation applications already open and a package of final rules published in June.
