The FCA has published a consultation paper which details plans to support tokenisation in asset management, as it seeks to make the UK a global leader in blockchain-based fund innovation.

Tokenisation is a method of digitally representing an asset or its ownership by recording it using distributed ledger technology (DLT).

DLT is a system that stores transaction records across multiple locations at once, rather than relying on a single, centralised database.

The FCA said it will provide guidance on how to manage tokenised fund registers under the regulator’s current rules through the UK Blueprint model.

The UK Blueprint model is a model under which companies can operate a register of tokenised share holders within existing legal and regulatory frameworks.

The regulatory body added it will provide an alternative and simplified trading model, aiming to allow fund managers to process the purchase and sale of units in authorised funds, both traditional and tokenised.

The UK watchdog will also publish a roadmap to address obstacles that currently hinder funds tokenisation, including using public blockchains and the settlement of transactions entirely on the blockchain, promoting discussions on how tokenisation models might evolve, and how regulation may need to change.

The FCA has described the UK is a leading asset management hub, with around 2,600 firms managing £14 trillion of assets for UK and global clients.

“The FCA is committed to supporting innovation to help the sector continue to grow, as set out in its strategy,” it said.

It added that the guidance comes as tokenised products become key to driving competition and increasing choice for consumers, opening new ways to distribute funds.

Simon Walls, executive director of markets at the FCA, said that tokenisation can boost “fundamental changes” in asset management, with benefits for both the industry and consumers.

“The UK has the opportunity to be a world-leader here and we want to provide asset managers with the clarity and confidence they need to deliver,” he said.

In September, the FCA also unveiled proposals that could reshape the regulatory landscape for crypto firms in the UK with a focus on both raising standards and, in some cases, exempting digital asset companies from certain requirements applied to traditional financial services.

The FCA’s consultation, published on 17 September, seeks feedback on how its existing rules—covering areas such as operational resilience, governance, and financial crime prevention—should be extended to cryptoasset businesses.

The regulator is also considering whether to apply its consumer duty, which requires firms to deliver good outcomes for customers, to the crypto sector.

The consultation period runs until November, with final rules expected in 2026.

---