About Innovate Finance

Innovate Finance is the independent industry body that represents and advances the global FinTech community in the UK. Our mission is to accelerate the UK’s leading role in the financial services sector by directly supporting the next generation of technology-led innovators.

Our membership base is diverse across FinTech and financial services including but not limited to challenger banks, payments firms, electronic money institutions, consumer credit providers, credit information providers, alternative credit rating agencies, wallet providers, personal finance apps, RegTech firms and digital asset firms.

The Digital Pound Foundation

The Digital Pound Foundation (DPF), an Innovate Finance programme since completing a merger in February 2025, is dedicated to advancing the UK as a leading global centre for development and adoption of new forms of digital money, including stablecoins, central bank digital currencies (CBDC) and tokenised deposits. It is a member-led forum supporting a diverse, effective and competitive ecosystem for new forms of digital money in the UK and globally and the development of a legal, regulatory and political landscape that enables the UK to embrace opportunities to become a leader in the FinTech space.

The DPF's members include a wide range of firms interested in digital assets, digital money and  payments including blockchain applications, payment systems and services, global stablecoin services, GBP stablecoin issuers, challenger banks and advisory firms. We therefore represent the full ecosystem of potential GBP stablecoin issuers and providers and have a unique 360 degree view of business models.

We are grateful to colleagues at CMS for their legal input and assistance in preparing this consultation response.

Overview of response

We welcome the FCA’s approach to ensure a more proportionate regime in a number of areas.

In particular this includes:

• a more outcomes-focused approach to disclosure
• the FCA’s decision not to take forward the DP24/4 proposal to require cryptoasset trading platforms (CATPs) to check the National Storage Mechanism before accepting a new qualifying cryptoasset disclosure document (QCDD), moving rules from prescriptive checks to principles-based processes
• the FCA’s decision not to take forward a new central platform for Primary Information Providers (PIPs)

We are, however, concerned that the Admissions and Disclosures (A&D) requirements as set out in CP25/41:

• replace the Consumer Duty with a tailored set of rules. We would urge the FCA to apply the Consumer Duty to drive forward appropriate outcomes, supplemented if need be by non-binding guidance
• create a confusing and duplicative set of rules for stablecoins. A&D requirements for stablecoin need to remove inconsistent duplication - to reduce unnecessary cost for industry and remove potential confusion for consumers

The market abuse rules outlined in the FCA’s paper present a sensible approach, but thresholds for smaller businesses need to be raised in line with UK SME definitions (£44m turnover) to be more proportionate in their expectations based on size of firm.

Finally, we note that the CP states “The restrictions on financial promotions will apply as normal to other communications relating to offers and admissions of qualifying cryptoassets such as advertisements or other documents which might be used to make an offer which are not QCDDs.”  Current FCA rules on financial promotion of crypto assets, notably the designation of ‘high risk’, is based on the absence of a regulatory framework for cryptoassets.  Introduction of the regime set out in CP25/41 and other parts of the FCA cryptoasset roadmap will significantly reduce the risk associated with regulated cryptoassets and the financial promotion rules must be reviewed and amended to reflect this.

Read the response here