The UK government has released a draft version of its regulatory framework for crypto assets, aiming to bring them under financial oversight. The legislation, which amends the Financial Services and Markets Act 2000 (Regulated Activities) Order (RAO), is now open for technical review. The draft outlines new categories of regulated activities within the cryptoasset space, such as custody services and exchange operations, all subject to the Financial Conduct Authority’s (FCA) jurisdiction. However, a key omission from this proposed framework is Decentralized Finance (DeFi). The draft specifically excludes DeFi models from its scope, stating that no special provisions will apply to truly decentralized activities. In cases where no identifiable individual or entity conducts the activity as a business, seeking FCA authorization will not be required. The FCA will evaluate each instance individually to determine whether any party or group exerts sufficient control to fall under the authorization requirements outlined in Section 19 of the Financial Services and Markets Act (FSMA). This draft is currently undergoing technical feedback only—primarily to address drafting errors or inconsistencies in alignment with the intended policy direction, as detailed in the accompanying Policy Note. Industry stakeholders are encouraged to point out any inconsistencies or areas needing clarification, but debate on broader policy approaches is discouraged. Meanwhile, pressure is mounting on the UK government to adopt a more proactive stance in supporting the digital assets sector. A coalition of six major UK digital economy trade associations has urged Prime Minister Keir Starmer’s administration to appoint a dedicated crypto envoy, requesting a coordinated national strategy for innovation, investment attraction, and job creation in blockchain and digital asset areas. For more news updates on this topic, visit DeFi Planet.