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DeFi Regulation

FCA Proposes Guidance on DeFi Interface Authorization

The UK Financial Conduct Authority has proposed guidance on when decentralized finance interfaces require authorization in the UK, alongside a separate paper on how regulated firms must manage DeFi risks. Both consultations close on Nov. 18. The proposals clarify the regulatory perimeter for DeFi front-ends and set risk-management expectations for authorized firms involved in DeFi.

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AI take

The significance here is that the FCA is drawing the perimeter around DeFi front-ends rather than the protocols themselves, which puts interface operators—often the most visible and centralized point in a DeFi stack—squarely in scope. The parallel paper on risk management signals that authorized firms touching DeFi will face expectations even where interfaces sit outside the perimeter, closing an obvious gap. With both consultations closing Nov. 18, whether the final guidance sharpens or blurs that interface-versus-protocol distinction is the open question worth watching.

Generated by AI for reference only.

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