68 registrations from 428 applications
Britain shows how demanding the label can be in practice. The FCA has supervised cryptoasset businesses for anti-money-laundering purposes since January 10, 2020, and its registration data, as at November 1, 2026, counts 428 applications in that time. Of the 395 it had decided, 68 ended in registration, about 17%.
Far more firms gave up than were turned away, with 266 withdrawals against 47 rejections and 14 refusals. The last 12 months look kinder. Twelve of 25 decisions were registrations.
Where the definition comes from
The term belongs to the Financial Action Task Force, author of the international anti-money-laundering standards. Its own site blocked automated readers on November 8, 2026, so the wording used here comes from the US Treasury, which quotes the definition in full in a 2023 risk assessment of decentralized finance.
In that text a VASP is any business that, on behalf of another person, does at least one of five things. Swapping crypto for ordinary money is one, and swapping one crypto for another is a second. Moving coins counts, as does keeping them or the keys that control them, and so does taking part in an issuer’s token sale.
A person who pays a friend from a self-custody wallet does none of that for anyone. The Treasury paper notes that unhosted wallets let people hold and send coins with no financial institution or VASP involved.
Few laws use the phrase
Ask a European exchange for its VASP license and expect a puzzled reply. The EU says crypto-asset service provider, and recital 6 of Regulation (EU) 2023/1113 states that MiCA’s list “also encompasses the virtual asset service providers identified as such by FATF”. In the US these firms qualify as money services businesses, according to the Treasury paper.
Britain uses two labels. Under regulation 14A of the Money Laundering Regulations 2017, a cryptoasset exchange provider swaps crypto for money or for other crypto, or runs a crypto ATM, while a custodian wallet provider safeguards coins or private keys for customers. A fuller regime, with authorization rather than registration, is expected to start on October 25, 2027, the FCA says, after applications close on February 28, 2027.
Registered is not the same as protected
The FCA’s AML supervision page says its role under this regime is limited to anti-money-laundering registration, supervision and enforcement. Being registered, it adds, “does not mean your customers benefit from the protections of the Financial Ombudsman Service or the Financial Services Compensation Scheme (FSCS).”
Most cryptoassets are not specified investments under British financial services law, so access to either scheme is unlikely, according to the same page. Before leaving savings with a UK-registered exchange, read its register entry for what the status actually covers.