UK Treasury to Seize Full Crypto Regulatory Control by 2027 - FCA to Become Enforcement Arm

London's financial power center is making its move. The UK Treasury is set to consolidate all cryptocurrency regulatory authority under its direct oversight, with the Financial Conduct Authority (FCA) transitioning into its primary enforcement mechanism by 2027.

From Watchdog to Weapon

The shift represents a fundamental restructuring of Britain's approach to digital assets. Instead of the FCA operating with independent regulatory discretion, it will execute a framework dictated by Her Majesty's Treasury. This centralizes policy-making in Whitehall while deploying the FCA's existing compliance and monitoring infrastructure as the operational tool.

The 2027 Deadline: A Countdown to Clarity or Control?

The two-year runway suggests a deliberate, phased transition rather than an overnight overhaul. Expect consultation papers, draft legislation, and a series of 'policy nudges' shaping the market well before the formal handover. For crypto firms, the clock is now ticking to align with a yet-to-be-fully-defined Treasury playbook.

A Single Point of Pressure

Proponents argue a unified regulatory front eliminates confusion and provides the certainty needed for institutional investment. Critics see a power grab that could stifle innovation with blunt, politically-motivated rules. One thing's certain: lobbying efforts just got simpler—there's only one door to knock on in Westminster.

The move signals the UK's intent to treat crypto less as a technological novelty and more as a systemic component of national finance—to be managed, taxed, and occasionally scolded from the center. It’s the kind of efficiency drive the City usually applauds, unless, of course, it's their own ox being gored.

By 2027, the question won't be how the FCA regulates crypto, but how precisely it follows Treasury's script. For an industry built on decentralization, the irony of its future being written in a single government department is almost too rich—almost as rich as the bankers who'll inevitably lobby to shape the rules in their favor.

Crypto Oversight and Consumer Protection

As Chancellor, Rachel Reeves drew attention to how the regulation will better position the UK as a financial hub. With regulation, companies will be in a better position to invest, innovate, and develop skilled jobs in the UK. Consumers will benefit from better protection. 

Crypto firms have to register with the FCA if they provide a service covered by money laundering laws. Exchanges, wallets, and other such sites will now have transparency requirements. “The UK wants to attract crypto firms with a clearer and more consistent regulatory vision,” stated Lucy Rigby, Minister for the City of London.

Consumers in the UK have lost 55% more in a year when it comes to investment scams. Law enforcement is working towards reducing fraud.

High-Profile Cases and Political Donations

One of the major cases of fraud relates to Zhimin Qian, in which he kept £5 billion in bitcoin. A total of 61,000 bitcoins were seized, which is the largest single crypto-seizure globally. Qian pleaded guilty to taking custody to illicit activities. Additionally, ministers are drawing up plans to ban making political donations using crypto to promote financial transparency.

Reform UK remains the first political organization to accept donations this year. They have reported taking their first registrable crypto donations. The Treasury’s MOVE marks a major change, bringing crypto in line with conventional financial systems and ensuring a standard of safety for consumers in the market in the UK.