The Financial Conduct Authority (FCA) published the Consultation Paper (CP) 25/14 to consult on proposed rules and guidance for the activities of issuing a qualifying stablecoin and safeguarding qualifying cryptoassets, including qualifying stablecoins.
The request for feedback from impacted parties closed on the 31st of July 2025. Following consideration of responses to these consultations, our final rules and guidance will be set out in Policy Statement(s) ahead of implementation.
The proposed changes impacting the qualifying cryptoasset custodian and stablecoin issuer are as follows:
Requirements for Issuers
- Appoint CASS Oversight officer
- Due diligence on third parties appointed to safeguard the backing assets
- Requirement for written agreements with the third party for safeguarding assets
- Record keeping and reconciliations, accurate books and records are essential to make sure the issuer is holding the correct amount of stablecoin backing assets
- Segregation and the statutory trust - segregating client assets from an issuer's own assets and holding them on trust for the benefit of qualifying stablecoin holders
- Conduct client asset audit
- Submit Client Money and Asset Return (CMAR)
Requirements for Custodians
- Full authorisation requirement (Part 4A of FSMA) or Variation of Permission
- Segregation of client assets from their own assets so that in the event of an insolvency, client assets can be easily returned to clients
- Accurate books and records to reflect assets being held in custody
- Reconciliations both internal and external to ensure accuracy of books and records, and identify and resolve discrepancies
- Adequate organisational arrangements to minimise risk of loss or diminution of clients' assets
- Proportionate approach to liability and potential use of client assets
- Periodic client disclosures and statements on client assets held
- Appointment of third party custodians who satisfy requirements such as due diligence, written agreements
How Fide Consulting Can Help
Our regulatory specialists have deep expertise in both CASS requirements and the evolving cryptoasset regulatory landscape. We can help your firm understand and prepare for these new requirements through gap analysis, policy development, and implementation support.