UK FCA Unveils Regulatory Framework for Tokenized Funds in Mainstream Markets

According to the Financial Conduct Authority, the UK regulator has introduced a new regulatory framework under statement PS26/7 that permits tokenized investment funds to operate within the UK's mainstream regulatory structure rather than under separate experimental arrangements. The framework approves the use of distributed ledger technology for maintaining investor records via the industry-standard Blueprint model, allowing on-chain transaction records to serve as official books for fund units. The FCA also introduced an optional Direct-to-Fund model enabling direct settlement between investors and funds through blockchain-compatible processes. Simon Walls, FCA executive director of markets, stated the regulator aims to provide firms with clarity and confidence to explore blockchain technology within a regulated environment.
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