On 30 April 2026, the Financial Conduct Authority (FCA) published Policy Statement 26/7: Progressing Fund Tokenisation (PS26/7).

Background

The FCA committed to progressing a roadmap for digital assets starting in asset management in its January 2025 letter to the Prime Minister, and its Strategy 2025-2030.

As a result, in Consultation Paper 25/28, the FCA proposed new guidance intended to support firms seeking to launch tokenised authorised funds in the UK using the industry‑led ‘Blueprint’ model and the FCA also proposed rules to introduce a new direct dealing model for all authorised funds to promote fund efficiency and aid tokenisation models.

PS26/7 summarises the feedback the FCA received on the tokenisation guidance and on the direct dealing proposals, its response to this feedback, and its final guidance and rules. The FCA also asked a series of discussion questions on near and long-term roadmaps for fund tokenisation in the UK to help inform its future work, as a result the FCA also share feedback on these discussion questions and set out how it will be taking forward the main themes raise by respondents.

Summary

  • Guidance on how managers can meet existing regulatory requirements when operating tokenised funds: The FCA set out that respondents almost all agreed with its proposed Handbook guidance on the operation of tokenised authorised funds, and that this would help firms meet the outcomes in the FCA’s rules. However, the FCA also highlighted that where firms gave feedback on additional areas that it would be useful to address in the guidance it had updated certain sections to reflect this, in particular to:
    • confirm that an on‑chain record of transactions may be considered the primary books and records for unit deals and that a firm doesn’t need to maintain a full ‘mirror’ off‑chain record of this information if it has appropriate resiliency plans in place, and
    • set out additional guidance on its rules on share classes, where units within a class are recorded on multiple blockchains, provided that the underlying rights of holders, and the nature of charges and expenses that may be taken from scheme property, remain the same.
  • Introduction of a direct dealing model: The FCA also set out that respondents supported the introduction of a new direct dealing model, direct to fund, noting the operational efficiency gains and the effect of enhancing the UK’s competitiveness and that the new single-stage process would facilitate tokenisation, by removing the requirement for units to be issued to the fund manager before being transferred to unitholders. However, the FCA also highlighted that it had received significant feedback on two elements of its proposals, in particular the FCA had proposed:
    • that all cash movements should be attributed to a given sub-fund, with unattributable payments either returned or moved to a client money account. Responses to the consultation argued that the costs of maintaining a standby client money account would be excessive. The FCA has therefore decided not to proceed with the client money account proposal and, instead, it sets out that it will apply enhanced rules on the reconciliation of umbrella cash accounts, and
    • not to allow overdrafts on omnibus accounts, or for sums received ahead of settlement date on one sub-fund to cover unpaid sums on another. The FCA explained that it had considered this necessary to ensure compliance with the protected cell legislation. However, in light of feedback, the FCA explained that it is considering this further with industry and are working with HM Treasury to clarify the application of the protected cell legislation in respect of omnibus accounts. It also emphasised that, while this clarificatory work is ongoing, firms wishing to utilise omnibus accounts to support direct dealing schemes will need to individually assess any proposed operating model to ensure compliance.
  • Feedback on discussion chapters on the future of tokenisation: The FCA explains that it had asked firms how it can support future use-cases for fund tokenisation, as well as where its rules may require further development. The FCA sets out a range of feedback from respondents to these discussion questions and, in relation to next steps, suggests that firms exploring tokenised portfolio management and composable finance take advantage of the FCA’s open-door policy, in particular that it wants to hear what initiatives firms currently have, and how composable finance may fit into firms’ existing roadmaps. The FCA also reminds firms of its Innovation Services, which support firms looking to explore use-cases. Finally, the FCA highlights that its digital assets roadmap includes work on a vision for how UK wholesale capital markets might adopt distributed ledger technology, including its thinking on regulatory principles and red lines, and that composability is a potential component of this work, but that it intends to seek views from firms on this later in 2026.

Next steps

The relevant guidance in relation to fund tokenisation and rules in relation to the direct dealing model come into force on the date of publication of PS26/7, 30 April 2026.