UK to require custody license for firms holding client crypto even for one day

The UK's Financial Conduct Authority (FCA) has published new Cryptoasset Perimeter Guidance that includes several technical pitfalls for companies handling customer cryptocurrencies, CoinDesk reported. The core of the new regulation is a "24-hour rule," which mandates that any software or platform holding customer assets for even a single day during a transaction must obtain a full custody license. Under the guidance, node operators or validators offering convenience features like automatic profit compounding will not be considered simple technology providers. Even the technical capability to access a customer's wallet is enough to bring a firm under the regulatory scope. The FCA has set a short five-month application window from September to February of next year. Companies that fail to apply within this deadline will be completely banned from operating in the UK.