Crypto and the Finance Function: What Growing Businesses Need to Get Right

Two Audiences, One Challenge

The businesses navigating digital assets fall into two broad groups, and the striking thing is how much they have in common. The first group, and the one this series addresses most directly, are the crypto-native businesses: wallet providers, platforms that automate crypto transactions from initiation to settlement, businesses acting as the front end between customers and exchanges, custodians, digital-asset infrastructure providers, and the wider ecosystem of ancillary service firms operating within the industry. Many of these businesses conduct activities that bring them within a regulatory perimeter, so their governance requirements are shaped both by the nature of digital assets and by formal statutory obligations. Yet their internal finance functions often look exactly like any other scaling business between £1m and £10m. The books are managed by a capable bookkeeper. An accountant handles the year-end. And the founder fills the strategic gap, making decisions about cash, controls, and compliance on instinct rather than infrastructure.

We have written at length about why that model breaks at scale in traditional businesses. In crypto-native firms, the stakes are higher, because the consequences of a controls failure are amplified. A mismanaged private key does not just create an accounting headache. It can create an irreversible loss. A poorly documented transaction trail does not just complicate the year-end. For an in-scope business, it can create a regulatory problem. A treasury position left unmanaged does not just create a cash squeeze. It can move the balance sheet by tens of thousands of pounds overnight.

The second group are established businesses encountering crypto through their existing operations. A supplier asks to settle in stablecoin. A client pays an invoice in Bitcoin. A board member raises tokenised assets at a strategy day. An e-commerce business explores accepting crypto payments to serve international customers. None of these businesses set out to become crypto companies, and making or receiving a crypto payment does not, on its own, turn them into regulated cryptoasset businesses. But they do face many of the same governance questions, and most have nobody in the finance function equipped to answer them.

The operational challenges, process design, controls extension, cross-border reconciliation, audit trail integrity, treasury management, are remarkably similar for both groups. The difference is one of degree and of regulatory status, not of underlying principle. A wallet provider processing thousands of daily transactions needs industrial-strength governance and may carry formal obligations. An established business accepting its first Bitcoin payment needs a proportionate version of the same framework. But the disciplines, segregation of duties, proper authorisation, documented audit trails, clear treasury policies, are the same disciplines. That is why the same Finance Director who helps a professional services firm build its financial controls can help a crypto platform build theirs. The currency is different. The discipline is familiar.

Why the Finance Function Matters More, Not Less

There is a persistent assumption in the digital asset industry that because blockchain technology is inherently transparent, with every transaction recorded on an immutable public ledger, the need for traditional financial governance is somehow reduced. This is a misunderstanding worth addressing directly.

Blockchain transparency gives you a record of what happened. It does not tell you whether what happened was authorised. It does not tell you whether the transaction was coded correctly in your accounting system. It does not tell you whether the asset was valued appropriately at the point of receipt, or whether the conversion to sterling was handled in a way that would satisfy a bank’s source-of-funds enquiry. It does not tell your board what the crypto position means for the business’s cash position next month. The ledger is visible. The interpretation is not.

This is precisely the gap that a Finance Director fills. Not the technology layer, not the compliance checkbox, but the interpretive, forward-looking, commercially grounded layer that connects what has happened to what should happen next. In a fiat environment, this is already the most underserved part of the finance function in many growing businesses. In a crypto environment, the gap is wider and the consequences of leaving it unfilled can be more severe.

Consider a few representative scenarios. A crypto platform reaches £3m in revenue and finds its month-end close takes three weeks, because nobody has designed the reconciliation process between on-chain activity and the accounting system. A wallet provider discovers that its custody arrangements would not stand up to regulatory scrutiny, because nobody with financial governance experience was involved in designing them. An established business accepts a £40k payment in Bitcoin, the bookkeeper is unsure how to code it, the asset drops in value before anyone decides what to do with it, and the board pack shows a cash position that does not match reality. These are not technology failures. They are finance function failures, and they are exactly the kind of failures an experienced FD is there to prevent.

The businesses that get into trouble with crypto are rarely the ones making bad strategic decisions. More often they are the ones with no framework for making the decision at all: no controls around custody, no policy on conversion, no process for reconciliation, and no one asking the hard questions before the commitment is made.

The Operational Landscape: Where the Real Challenges Sit

The challenges that matter most are not the ones that make headlines. They are operational, procedural, and, frankly, unglamorous. They are the same challenges that sit at the heart of every well-run finance function, applied to a new context. This series addresses four of them in depth.

Process, systems and controls

Most control frameworks were designed for traditional banking rails, where money moves through regulated institutions that offer identifiable counterparties, investigation procedures, and possible recovery routes, even though recovery is never guaranteed. Crypto changes this. A digital asset held in a wallet is controlled by whoever holds the keys. If a transaction is sent to the wrong address, there is often no institution positioned to investigate or reverse it. The consequences of a controls failure can be irreversible.

For crypto-native businesses, this means building governance frameworks that cover wallet management, key custody, authorisation hierarchies, segregation of duties, and reconciliation from the ground up, often under regulatory expectations. For established businesses extending into crypto, it means auditing existing controls and identifying where they break when a digital asset enters the picture. In both cases, the principle is the same: the FD’s role is governance architecture, not technology. We explore this in the article on extending financial controls to digital assets.

Cross-border transactions

Cross-border settlement is one of the most common entry points for crypto in non-crypto businesses, and a core part of the operating model for many crypto-native firms. A supplier asks to be paid in a stablecoin because it can be faster and cheaper than a traditional transfer. A platform processes transactions across multiple jurisdictions with different regulatory requirements. The commercial logic is often sound. The operational implications are significant.

FX exposure, settlement timing, regulatory divergence across jurisdictions, banking relationship management, and multi-system reconciliation are all familiar challenges in cross-border commerce. Crypto adds a layer of complexity, and specific risks such as stablecoin depegging and network selection, that existing systems and processes were not designed for. Where transfers involve an in-scope cryptoasset service provider, additional obligations such as the Travel Rule may apply. Our article on cross-border crypto transactions unpacks the operational detail.

Audit trail, source of funds and evidence

In traditional banking, source of funds is relatively straightforward, because payments arrive from named accounts at regulated institutions with a clear paper trail. In crypto, a payment arrives from a wallet address, which is pseudonymous by default. Connecting that address to a named counterparty and a documented commercial purpose requires deliberate record-keeping. When a business converts crypto to sterling and deposits it, its bank may ask about the source of the funds, particularly where the activity is material, unusual, or international. A business that can answer that question clearly is in a far stronger position than one that cannot.

The Cryptoasset Reporting Framework (CARF), which took effect for UK reporting purposes from 1 January 2026, is expected to increase HMRC’s visibility of activity conducted through in-scope reporting service providers, with the first reports due in 2027 and many jurisdictions participating in data exchange. It does not create a complete record of every direct wallet-to-wallet transaction, but it materially changes the transparency landscape. Our article on audit trail and source of funds addresses what this means in practice and how to build evidence that stands up to scrutiny.

Treasury and cashflow

Holding digital assets, even briefly, raises treasury questions that most finance functions have never had to answer. Do you convert to fiat immediately, hold to a threshold, or retain a position? How much volatility can the business absorb before it affects the ability to meet payroll, tax, and supplier obligations? How do you forecast cashflow when part of the position can move materially in a day? Our treasury article sets out a conversion-policy decision framework and the wider discipline of managing cash when not all of it behaves like cash.

The Regulatory Moment

The UK’s regulatory framework for cryptoassets is undergoing its most significant expansion in years, and every business touching digital assets should understand where it is heading. The detail below reflects the position as we understand it in 2026, and dates and scope should always be confirmed against current official sources before acting.

In February 2026, Parliament passed legislation bringing a broad range of crypto activities within the FCA’s regulatory perimeter for the first time. The FCA published its final rules and guidance in mid-2026, and has indicated that its authorisation gateway for crypto firms opens in late September 2026, with the full regime expected to come into force from late October 2027. Until the new regime takes effect, the FCA’s oversight of crypto continues to focus on financial promotions and anti-money laundering controls. Under this framework, activities such as operating a trading platform, providing custody, dealing or arranging, and issuing qualifying stablecoins are expected to require authorisation.

The Property (Digital Assets etc) Act 2025, which came into force in December 2025, confirms that certain digital assets can be treated as personal property under the law of England and Wales, providing a clearer statutory basis for ownership, transfer, and legal protection in cases of fraud, dispute, or insolvency.

For crypto-native businesses, this is the moment to prepare for authorisation and to build governance that would withstand regulatory scrutiny. For established businesses encountering crypto, the message is simpler but no less important: the regulatory direction is towards greater transparency and higher expectations on record-keeping, without every operational user becoming a regulated firm. An experienced FD tracks where regulation is heading, not just where it is today. That kind of horizon-scanning is the difference between being ready and being caught out.

The FD’s Approach: Same Discipline, New Context

The approach we take when working with businesses in the digital asset space follows the same logic we apply to any finance function challenge. Start with the process, not the product. Understand the landscape before you commit to a tool. And keep a human mind in the loop.

Does the finance function have the right architecture? Clean chart of accounts, clear controls, a reporting framework that can accommodate digital assets alongside traditional ones. If the basics are not in place for fiat, adding crypto will amplify the mess. This is the same pattern we see with technology adoption: automating or digitising a broken process does not fix it.

Are the controls fit for purpose? Custody governance, authorisation frameworks, segregation of duties, reconciliation processes. For a crypto-native business, these need building from the ground up, often to a regulatory standard. For an established business extending into digital assets, the existing controls need auditing and extending proportionately. Either way, the FD designs the governance, not the technology.

Is the audit trail defensible? Can the business evidence the immediate source of funds and the commercial purpose of a transaction to a bank, an auditor, or, where relevant, a regulator? Is the documentation captured at the point of transaction rather than reconstructed later? This is the area where many businesses are most exposed, because the assumption is that blockchain transparency means the trail exists automatically. The on-chain record exists, but linking it to counterparties, commercial purpose, and accounting entries requires deliberate process design.

Do we have the right people and the right advice? The bookkeeper, the accountant, the FD: do they collectively have the knowledge to handle the operational, governance, and, where applicable, compliance implications of digital assets? If not, who fills the gap? This is not a criticism of existing providers. It is a practical question about capability, and the answer determines whether the business navigates crypto with confidence or learns by expensive mistake.

Ready or Not

Whether you are building a business in the digital asset industry or running an established company that is starting to encounter crypto through its operations, the question is the same: is your finance function ready for this?

That readiness does not require a transformation programme. It requires someone with the experience to know what good financial governance looks like, and the judgement to apply it to a new asset class with the same calm, methodical discipline they would bring to any other finance challenge, at a scale and depth proportionate to what the business actually does.

If you are wondering whether your finance function, your controls, your processes, or your governance framework is equipped for digital assets, that is a conversation worth having. It does not need to be long. It just needs to be honest.