12th June

You can read last week's “This week in crypto” here.

The UK’s Financial Conduct Authority (FCA) proposes allowing retail investors to access crypto exchange-traded notes (ETNs), reversing its previous stance that deemed these products too risky for non-professionals. While the final decision hinges on consultation feedback, this marks an important step towards widening access—so long as investors remain aware of the inherent risks.

This policy shift aligns with the FCA’s broader strategy to stimulate economic growth and digital finance prominence. It plans to implement enhanced investor education, maintain financial promotion rules, and restrict these investments to approved trading venues, striking a balance between access and protection.

Importantly, the FCA is clear that crypto derivatives (such as futures and options) will remain off-limits to retail buyers. This selective approach allows participation in straightforward instruments like ETNs while shielding consumers from more complex, speculative products.

French banking heavyweight Société Générale has announced “USD CoinVertible,” a US dollar‑pegged stablecoin to begin trading in July via its SG‑FORGE division. It will operate on Ethereum and Solana blockchains, with custodial support from BNY Mellon.

This launch follows the bank’s earlier euro-pegged stablecoin introduced in 2023, which saw modest uptake. The new stablecoin promises to enhance cross-border payments, support crypto trading, streamline FX operations and strengthen collateral offerings. It signals a bold step by a major European bank into an area traditionally dominated by US issuers.

By entering the dollar‑denominated stablecoin market, Société Générale demonstrates confidence in blockchain’s ability to offer faster, more transparent and cost-effective financial services. This move may encourage other European banks to embrace digital assets as well.

The FCA has appointed its first-ever Deputy CEO, marking a notable strengthening of its leadership amid expanding responsibilities, including crypto regulation. The new appointee will oversee areas such as financial promotions, consumer protection, and ESG compliance – all of which intersect with growing digital asset oversight. This move underscores the FCA’s commitment to a proactive regulatory stance as retail crypto products like ETNs re-enter the market.

Commentators suggest that assigning a deputy CEO signals a shift away from reactive policymaking, enabling the FCA to manage increasing innovation in financial technology. With stablecoin projects and tokenised assets gaining traction, the regulator aims to ensure crypto products are launched with robust safeguards in place. The deputy’s role will include coordinating cross-sector initiatives and liaising with international counterparts to harmonise crypto regulations.

The FCA’s enhanced leadership structure is welcome news for the industry, which has called for clearer guidance and faster approvals. It should also provide added assurance to consumers and investors navigating the emerging digital asset space. However, challenges remain, particularly around balancing innovation with risk mitigation in a rapidly evolving ecosystem.

Hong Kong’s financial authorities have issued final regulations for stablecoin licensing, including anti-money laundering controls, consumer safeguards, and capital reserves. The framework mandates that issuers maintain 1:1 reserves, undergo regular audits, and implement robust governance structures, signalling the region’s intent to become a crypto hub. Unlike earlier proposals, the final rules also address “emergency redemption” protocols, ensuring users can access fiat backing during systemic stress.

Regulators aim to attract major fintech firms by offering clear and credible licensing that balances innovation with prudence. Several global stablecoin issuers have already initiated applications, suggesting Hong Kong is emerging as a jurisdiction leading in digital payment token infrastructure. The move is consistent with broader regional ambitions to integrate blockchain technologies into mainstream finance, including tokenised bonds and CBDC pilots.

Analysts expect the new rules to foster investor confidence and facilitate institutional participation in tokenised assets. Hong Kong’s stance contrasts with more cautious approaches in some Western markets, potentially positioning it as a preferred base for Asian and global stablecoin operations. However, careful monitoring will be needed to ensure compliance and avoid regulatory arbitrage.

This week in crypto saw the FCA move to lift its long‑standing ban on retail access to crypto exchange‑traded notes, marking a groundbreaking shift that will enable individual investors to trade high‑risk crypto products under strict financial promotion rules on approved exchanges, while keeping derivatives off‑limits.

Société Générale announced the upcoming launch of its US dollar‑pegged stablecoin, USD CoinVertible, utilising Ethereum and Solana platforms with custodial support from BNY Mellon, representing Europe’s first major foray into dollar‑denominated stablecoins under MiCA regulation.

The FCA has also strengthened its leadership by appointing a Deputy CEO to oversee its growing responsibilities in crypto‑asset oversight, financial promotion and consumer protection.

Meanwhile Hong Kong finalised its comprehensive stablecoin licensing framework featuring 1:1 reserve backing, mandatory audits, governance standards and emergency redemption protocols positioning itself as a major global hub for regulated digital assets.

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