U.K.'s FCA moves to allow mutual funds 10% exposure to crypto ETNs

The U.K.'s Financial Conduct Authority proposed allowing certain retail investment funds to hold up to 10% of their assets in cryptocurrency exchange-traded notes (ETNs). The suggestion appears in the regulator's latest quarterly consultation paper and targets UCITS schemes and some non-UCITS retail schemes (NURS).

UCITS and NURS are regulated, open-ended structures that pool money from retail investors into managed portfolios, similar to mutual funds in the U.S. "Our proposed 10% limit for UCITS and NURS would also mitigate the risk of significant impacts arising from crypto ETN exposure," the FCA wrote.

The move follows the regulator's decision in October 2025 to allow retail investors access to crypto exchange-traded products under the ETN banner, lifting a ban in place since 2021. Vehicles that give exposure to cryptocurrency without requiring investors to buy and custody the assets have driven mainstream adoption, and critics have said regulatory hurdles risk leaving the U.K.

United Kingdom

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