OpenLegislation

Explanatory note

Original text. Later amendments are not shown.

(This note is not part of the Order)

This Order inserts a new paragraph 22 into the Schedule to the Financial Services and Markets Act 2000 (Collective Investment Schemes) Order 2001 (S.I. 2001/1062) (“the CIS Order”). The Schedule to the CIS Order specifies the kinds of arrangements which do not amount to a collective investment scheme as defined in section 235 of the Financial Services and Markets Act 2000 (c. 8).

New paragraph 22 clarifies that arrangements for qualifying cryptoasset staking do not amount to a collective investment scheme. Staking is a consensus mechanism used by “proof of stake” blockchains. Blockchains are distributed ledgers on which various computers performing the function of “validator nodes” collaboratively enter and validate transactions to achieve consensus on the network’s state. Qualifying cryptoasset is defined by reference to the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (S.I. 2005/1529).

A full impact assessment has not been produced for this instrument as no, or no significant, impact on the private, voluntary or public sector is foreseen.