FCA Crypto Custodian Registration Regime: What We Know About Copper.co, Zodia Custody, and FSMA 2023 Compliance

The UK Financial Conduct Authority has established a registration regime for cryptoasset businesses under powers granted by the Financial Services and Markets Act 2023, with the application window for existing operators opening in February 2024. The FCA public register confirms that both Copper.co and Zodia Custody have completed registration as cryptoasset businesses, with Copper.co's registration confirmed in March 2025 and Zodia Custody's registration confirmed in April 2025.

The FSMA 2023 Regulatory Framework

The Financial Services and Markets Act 2023, which received Royal Assent on June 29, 2023, provided the FCA with explicit powers to create a registration regime for cryptoasset businesses operating in the UK. This legislation forms the statutory foundation for the FCA's approach to supervising firms engaged in cryptoasset activities, including custody services.

Under this framework, cryptoasset businesses seeking to operate in the UK must demonstrate compliance with the FCA's regulatory requirements before receiving authorization. The regime covers multiple operational dimensions, including capital adequacy standards, anti-money laundering controls, and consumer protection measures.

FCA Application Process Opened February 2024

The FCA officially opened the cryptoasset registration application window for existing operators on February 14, 2024. This marked a significant milestone in the UK regulatory calendar, allowing firms already operating in the crypto space to begin the formal registration process.

The FCA's registration process requires applicants to submit detailed documentation demonstrating adherence to the regulatory standards. Firms must provide evidence of robust governance structures, comprehensive risk management frameworks, and effective systems and controls.

According to FCA statements through mid-2025, the review process remains ongoing, with completion timelines varying based on individual application complexity. The FCA has emphasized that registration is not automatic and that firms must meet all applicable requirements before receiving approval.

Registered Custodians: Copper.co and Zodia Custody

Copper.co and Zodia Custody appear on the FCA public register as registered cryptoasset businesses. Copper.co's registration was confirmed in March 2025, while Zodia Custody's registration was confirmed in April 2025.

Both firms offer cryptocurrency custody services to institutional clients. These services typically involve secure storage of private keys and digital assets on behalf of clients, a function that has attracted regulatory attention due to the consumer protection and operational resilience implications.

The FCA public register confirms the registration status of these firms, though the full regulatory conditions attached to individual registrations have not been publicly disclosed.

Current Status of FCA Regulatory Initiatives Grid

The FCA publishes a Regulatory Initiatives Grid that outlines planned regulatory developments. The research bundle indicates uncertainty regarding specific details about the Grid's 10th edition and its contents related to crypto custody provisions. Given the knowledge cutoff limitations, specific claims about future Grid publications or their contents cannot be verified at this time.

Industry participants seeking the most current information should consult the FCA's official channels directly for updates on regulatory initiatives and timelines.

What Remains Unverified

Several areas mentioned in industry discussions cannot be confirmed based on available sources. These include specific compliance cost estimates for institutional crypto custodians under the FCA regime, detailed requirements for stablecoin custody under MiCAR-style rules, and the precise implementation timeline for crypto custody via Financial Services and Markets Act secondary legislation.

The FCA has not published definitive figures regarding the operational compliance costs that custodians can expect to incur under the new regime. Similarly, while the registration framework exists, the granular requirements continue to evolve through the application review process.

Market Implications

The FCA's registration regime represents a significant development for the UK crypto market. By requiring formal registration, the FCA is establishing clearer standards for crypto businesses and creating a more structured regulatory environment.

For institutional participants, the registration of firms like Copper.co and Zodia Custody provides a baseline level of regulatory assurance. However, investors should note that registration does not equate to endorsement of specific business practices or investment products.

The registration process also signals to international market participants that the UK is developing a defined regulatory pathway for crypto businesses, which may influence decisions about market entry and operational structure.

What Firms Should Do

Crypto businesses still navigating the registration process should engage early with FCA guidance and ensure their applications are comprehensive. Given the ongoing nature of reviews, firms should maintain realistic timelines and prioritize thorough documentation of their compliance frameworks.

Market observers should monitor FCA communications for updates on registration processing times and any emerging guidance on specific crypto activities.

Coinasity's Take

The FCA's cryptoasset registration regime, built on the FSMA 2023 foundation, is reshaping how digital asset businesses operate in the UK market. The registration of Copper.co and Zodia Custody demonstrates that the process is functional and that established custodians can successfully navigate the requirements. However, the uncertainty around specific compliance timelines and cost estimates reflects the broader challenge facing regulators and industry alike: balancing investor protection with innovation-friendly oversight. Market participants should approach claims about future regulatory developments with appropriate caution until confirmed through official FCA channels.