The UK Financial Conduct Authority (FCA) has proposed allowing UCITS and Non-UCITS Retail Schemes (NURS) to invest up to 10% of their assets in cryptocurrency exchange-traded notes (ETNs). This proposal, included in its latest quarterly consultation paper, marks a significant step toward wider crypto adoption in regulated investment funds. UCITS and NURS are similar to US mutual funds, pooling retail investor money into managed portfolios. The FCA emphasized that the 10% limit would mitigate risks from crypto ETN exposure. This follows the FCA's October 2025 decision to lift a ban on retail access to crypto ETNs, which had been in place since 2021. The move comes amid criticism that strict UK regulations place the country at a disadvantage compared to peers in crypto innovation. Crypto ETNs allow investors to gain exposure to cryptocurrencies without directly holding or managing the assets, facilitating mainstream adoption. The proposal is now open for public consultation.

Key facts

• FCA proposes 10% limit for UCITS and NURS funds to invest in crypto ETNs.
• Proposal builds on October 2025 decision to allow retail access to crypto ETNs.
• UCITS and NURS are regulated open-ended funds similar to US mutual funds.
• FCA aims to mitigate risks while expanding crypto exposure in UK investment funds.
• Public consultation period is now open for feedback on the proposal.