Q&As
To what extent can cryptoassets form part of, or be used by, a UK fund; and how does this interact with existing UK financial services legislation?
We have assumed that this question does not relate to a tokenised fund or a blockchain traded fund (BTF), but a fund that invests in cryptoassets, including cryptocurrencies, such as bitcoins or ethereum.
funds are a form of collective investment. See Practice Note: collective investment schemes—essentials, which explains what a collective investment scheme (CIS) is and covers the definition of CIS set out in section 235 of the Financial Services and Markets Act 2000 (FSMA 2000). You will note from the Practice Note that a CIS can relate to property of any description. See also Practice Note: Web 3.0, digital assets and cryptoassets-essentials. You will note under the heading ‘Cryptoassets as property’ that case law has confirmed that cryptoassets are to be viewed as property.
Note that CISs can be regulated by the Financial Conduct Authority (FCA) or unregulated.
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