UK FCA Proposes Stricter Crypto Wallet Due Diligence Measures
The Financial Conduct Authority seeks enhanced scrutiny of transactions involving personal crypto wallets in new guidance.
The Financial Conduct Authority seeks enhanced scrutiny of transactions involving personal crypto wallets in new guidance. This is an original TLT brief based on reporting by Blockonomi, with live market data added, as of Mon, 26 Oct 2026 12:00:08 UTC.
The proposed measures could significantly impact how crypto firms handle transactions with personal wallets, potentially increasing compliance burdens and affecting user privacy. This development reflects the FCA's ongoing efforts to mitigate financial crime risks in the crypto sector while balancing innovation and regulation.
- FCA proposes enhanced due diligence for transactions with personal crypto wallets
- Guidance criticizes reliance on unexplained third-party risk scores
- Measures aim to strengthen financial crime prevention in crypto transactions
- Market cap: $2.75T; Bitcoin: -0.03% in last 24 hours
The UK's Financial Conduct Authority (FCA) has opened a consultation on proposed updates to its Financial Crime Guide, which includes new guidance on due diligence for transactions involving unhosted, or personal, crypto wallets. The draft guidance, released on October 23, 2023, outlines enhanced due diligence measures as good practice for firms dealing with such transactions.
The FCA's proposal comes amid growing concerns over the potential misuse of crypto assets for financial crimes. The guidance emphasizes the importance of robust risk assessments and due diligence processes, particularly for transactions that are more susceptible to illicit activities.
Both Blockonomi and CryptoSlate report that the FCA criticizes the use of third-party risk scores that firms cannot adequately explain or evidence. The guidance suggests that such practices are considered poor practice and could undermine the effectiveness of anti-money laundering efforts.
The FCA's move is part of a broader trend of regulatory scrutiny in the crypto sector. As governments and financial regulators worldwide seek to balance innovation with the need to prevent financial crimes, such measures could become more common. The consultation is open for feedback, allowing industry stakeholders to provide their input on the proposed measures.
In the current market context, the total crypto market cap stands at $2.75 trillion, with 
Bitcoin showing a slight decline of 0.03% in the last 24 hours. The overall market remains relatively flat, with a Fear & Greed index of 50 indicating a neutral sentiment.
UK FCA Proposes Stricter Crypto Wallet Due Diligence Measure — questions & answers
What is the FCA proposing regarding crypto wallets?
The FCA proposes enhanced due diligence for transactions involving personal crypto wallets.
Why is the FCA concerned about third-party risk scores?
The FCA criticizes the use of unexplained third-party risk scores, considering them poor practice.
How might this affect the crypto market?
The proposed measures could increase compliance burdens for firms and impact user privacy, potentially influencing market dynamics.
Which outlets reported this story?
This is an original TLT brief that synthesises reporting from Blockonomi. It is not a copy of any one article — follow the source links above for the original reporting.
Original summary — not financial advice. This is an original TLT brief that summarises a development reported elsewhere and adds live market data for context; it is not the original article and reproduces no part of it. Follow the source link above for full details. Crypto is volatile and high-risk — always do your own research.