In today’s fast-moving digital economy, change is the only constant and nowhere is that more true than in the world of emerging finance and technology. Every week, new updates surface that shape how investors, innovators, and everyday users interact with digital platforms. From shifts in policy that redefine the rules of the game to fresh approaches designed to make systems more secure and resilient, the pace of transformation is relentless. These developments don’t just impact companies and regulators they touch everyone who engages with digital tools, whether through investing, payments, or simply staying connected. Understanding these changes isn’t about chasing headlines; it’s about keeping perspective on how innovation and oversight come together to shape the future of trust and opportunity.
UK FCA Proposes Exempting Crypto Firms from Some Traditional Finance Rules
The UK’s Financial Conduct Authority (FCA) has put forward a proposal to ease certain regulatory burdens on crypto firms specifically, some rules that are conventionally applied to financial services companies but might not neatly align with the crypto sector’s structure or risks. These proposed exemptions include rules that require firms to conduct business with integrity, to act with skill, care and diligence, to make decisions in the customer’s best interest, and to ensure that advice or discretionary decisions are always suitable for customers.
At the same time, the FCA is signalling it will maintain or even tighten rules in areas that are more specific to crypto’s risk profile. One of those areas is operational resilience, meaning how secure and robust crypto exchanges and related firms are especially in light of incidents like the US$1.5 billion hack at Bybit earlier in the year, which the FCA is using as evidence of why stronger cyber and operational protections are needed.
Source: Reuters+1
Another major piece is that the FCA is inviting public feedback on applying things like Consumer Duty (which in UK regulation means the firm must put customers first in outcomes, not just stay within the letter of the rules) to crypto asset firms. Also under review is whether customers of crypto firms should have access to the Financial Ombudsman Service, to enable redress in case of harm.
Source: Reuters
The UK regulatory timeline: these changes are being consulted now; the broader regulatory framework for crypto is expected to be more formalised starting in 2026.
Source: Financial Times+1
Why it matters & implications:
- This proposal is trying to strike a balance: making the UK attractive for crypto innovation and global competition, while still protecting consumers. Relaxing some “traditional finance” rules for crypto entities could reduce overhead and friction, potentially encouraging new entrants or scaling existing ones. But the risk is that consumers may face greater exposure to misconduct, misleading advice, or harmful incentives if protections are too weak.
- The decision to not immediately apply certain consumer protection rules (like Consumer Duty) shows the regulator is cautious about forcing rules that crypto firms might struggle to comply with due to the sector’s technical or business model differences. But delaying protections can leave gaps where consumers are vulnerable.
- The Bybit hack being explicitly referenced signals that regulators are acutely aware of operational risks in crypto cybersecurity, infrastructure, system stability and see them as justifying stricter oversight in those domains.
- For crypto firms, this means they need to prepare both for some loosening (or adaptation) of certain regulatory burdens but also for potentially stricter requirements in areas like operational risk, resilience, audits, etc.
- For the market and investors: this could mean more clearly defined expectations and standards for crypto firms in the UK, maybe more trust, but also uncertainty during transition, depending on how the final rules land.
2. India Mandates Cybersecurity Audits for Crypto Exchanges, Custodians, and Intermediaries
In India, the government has taken a firm step in tightening security regulation of the crypto sector. Due to rising incidents of cyber thefts affecting crypto platforms, it has made cybersecurity audits mandatory for all cryptocurrency exchanges, custodians, and intermediary service providers.
These audits must be conducted by auditors registered with CERT-In (the Indian Computer Emergency Response Team), which is the nodal cybersecurity agency under the Ministry of Electronics and Information Technology. The requirement is not just good practice it has regulatory teeth: failure to comply may lead to denial or cancellation of registration with the Financial Intelligence Unit (FIU) under India’s anti‐money laundering framework.
Source: Business Standard+2Gadgets 360+2
India currently has around 55 entities (crypto exchanges, custodians, etc.) subject to these rules.The government is acting in response to a pattern of increasing crypto‐related cybercrimes and vulnerabilities recent hacks, misuse of platforms, and concerns over how securely private keys or critical infrastructure are protected.
Source: The Crypto Times+1
Why it matters & implications:
- From a security standpoint, this is a very significant move. By mandating audits by government‐recognized cybersecurity experts, India is trying to reduce the chances of hacks and breaches that could wipe out user funds or erode trust in the crypto industry.
- It connects cybersecurity to registration and licensing meaning crypto platforms must comply not just out of good will but for legal status and ability to operate. That raises the stakes.
- For users and consumers, this adds a layer of confidence: platforms that don’t have their systems audited could be penalised or shut down. On the flip side, it’s possible costs for exchanges will go up (paying auditors, upgrading security) and smaller players may find it harder to comply.
- It could also improve transparency and force industry standardization in areas like how keys are stored, how system vulnerabilities are monitored, disaster recovery, etc.
- The move may also help India in its broader regulatory coherence for digital assets: tying cybersecurity, anti‐money laundering, and platform operations together.
Thanks for stopping by and giving this a read. There’s always something new unfolding, and it’s easy to miss out on the details that matter. Keep reading, stay curious, and stay updated you never know what’s coming next.
