The Crypto-Asset Senior Manager Market

The UK is moving crypto-asset activities from a registration-only model into full FCA authorisation. Until now, crypto-asset exchanges and custodian wallet providers have mainly needed to register with the FCA for anti-money laundering purposes under the Money Laundering Regulations. Under the new regime, firms carrying on regulated crypto-asset activities will need authorisation under the Financial Services and Markets Act, and that brings the Senior Managers and Certification Regime with it.

For many crypto businesses, that’s a significant change. Leaders who have run the firm under the registration regime may need regulatory approval as Senior Managers for the first time. Firms will need compliance oversight, money laundering reporting, and in many cases risk and finance leadership that meets the standard expected of any other authorised firm. The pool of candidates who combine crypto-asset expertise with experience of authorised-firm governance is very small.

What Authorisation Means for the Senior Team

Approved Senior Managers

Firms seeking authorisation will need to name Senior Managers in their applications, each assessed against the fit and proper test. Typical functions include the SMF1 Chief Executive, SMF3 executive directors, the SMF9 Chair where there is one, and SMF16 Compliance Oversight and SMF17 Money Laundering Reporting. Larger firms may need more. Our guide to which SMFs apply at each firm tier explains how the tiers work.

Statements of Responsibilities

Each Senior Manager will sign a Statement of Responsibilities setting out exactly what they’re accountable for. For crypto firms, areas such as custody of client assets, market conduct and operational resilience need clear owners. Our article on writing a Statement of Responsibilities explains how.

Timing

The people named in an application can make or break it, and candidates with the right experience are in demand from many firms preparing at once. Firms that recruit early, before the application window, are best placed. Our SMF authorisation support plans the team around your submission date.

Where the Regulator Is Likely to Focus

Financial Crime

Financial crime has been the FCA’s central concern with crypto-asset firms since registration began, and it will remain so. The MLRO needs deep experience of blockchain analytics, transaction monitoring and sanctions in a crypto context.

Custody and Client Assets

How client crypto-assets are held, segregated and protected will be central to the regime. Senior Managers need a clear grasp of custody arrangements and how they would work if the firm failed.

Market Integrity and Consumer Outcomes

Firms serving retail customers will face expectations on financial promotions, conduct and consumer outcomes similar to those in other retail markets. Trading platforms will face expectations on market abuse and fair dealing.

Operational Resilience

Technology is the business for most crypto firms. Operational resilience, cyber security and third-party dependencies will need senior ownership.

How We Run Crypto-Asset SMF Searches

Every search starts from the Statement of Responsibilities the new Senior Manager will sign and any Prescribed Responsibilities they’ll carry. We build the specification around that accountability rather than a job title, then approach candidates directly and in confidence. Most of the strongest candidates aren’t actively looking, and many already hold approvals at competing firms.

Before anyone reaches your shortlist, we test them against the fit and proper test: prior approvals, regulatory history, directorships and financial soundness. We start regulatory references early, because late references are one of the most common causes of delay. For crypto roles, we test whether candidates can meet the standards of an authorised firm as well as their crypto-asset expertise.

Adrian Lawrence FCA interviews every shortlisted candidate personally, and we stay involved until your new Senior Manager is approved and in post. For a realistic view of the stages, see how long an SMF appointment actually takes, and for the full service, our SMF recruitment services page.

The Senior Roles We Recruit

Chief Executives

We recruit leaders who combine crypto-asset market knowledge with credibility in front of the FCA, including founders’ successors for firms moving to an institutional structure.

Compliance Officers and MLROs

We place compliance leaders and MLROs who understand both crypto-asset risks and authorised-firm compliance. Candidates who have taken a firm through FCA registration, or come from traditional financial services with genuine crypto experience, are especially valuable.

Risk and Operations Leaders

We recruit risk leaders and chief operating officers who can own custody, resilience and technology risk to the standard of an authorised firm.

Finance Leaders

Crypto firms need finance leaders who understand client asset accounting, capital requirements and regulatory reporting. Our sister practice FD Capital recruits finance directors and CFOs, including for crypto-asset businesses.

Independent Chairs and Non-Executives

An independent chair or non-executive with authorised-firm governance experience can strengthen an application considerably, and gives the board the challenge the regulator will expect.

Candidates From Traditional Financial Services

Many crypto firms look to banks, payments firms and investment managers for Senior Managers with authorised-firm experience. That can work well, but the best appointments combine that background with genuine crypto-asset knowledge, whether from direct experience, a digital assets role at a traditional firm, or sustained work with crypto clients. We test both sides, so firms don’t end up with a strong governance CV that can’t engage credibly with the business.

Hiring Challenges for Crypto-Asset Firms

• A very small candidate pool combining crypto expertise and authorised-firm governance.
• Competition from many firms preparing for authorisation at the same time.
• First-time Senior Managers, including founders, who need to make a strong case for approval. Our article on first-time Senior Manager roles explains how.
• Candidate caution, as experienced Senior Managers look closely at a firm’s history before taking on personal accountability.
• Interim needs while the permanent team is built, where interim or fractional Senior Managers can help.

Other Sectors We Recruit For

SMF Capital recruits Senior Managers across the regulated market. Alongside this sector, we run dedicated searches for Wealth Managers & Advice Firms, Investment Managers & Hedge Funds, Consumer Credit Firms, Insurers, Brokers & MGAs, Banks & Building Societies and Payments, E-Money & Fintech. We also work with overseas firms opening UK branches and firms seeking FCA authorisation, in London, Birmingham, Bristol and across the UK.

Frequently Asked Questions

Will our crypto firm need Senior Managers?

If your firm will carry on activities that require authorisation under the new regime, it will need approved Senior Managers. Firms that remain registered only for anti-money laundering purposes are in a different position. We’ll help you work out which applies.

When should we start recruiting?

As early as possible, ideally well before you plan to submit an application. The right candidates are in demand, and approval timelines add months.

Can our founders hold Senior Manager Functions?

Often, yes, provided they can show they’re fit and proper for the specific function. Where there are gaps, the application can address them with support, training or additional non-executive oversight.

Do you recruit crypto MLROs?

Yes. MLRO and financial crime leadership is one of the most in-demand crypto roles, and we test candidates specifically on crypto-asset transaction monitoring and sanctions experience.