In a major enforcement operation, the UK's Financial Conduct Authority (FCA) has launched a coordinated sweep against unlicensed peer-to-peer (P2P) crypto trading platforms. The crackdown, carried out in conjunction with HM Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), targeted eight sites across London, resulting in cease-and-desist orders and the gathering of evidence for ongoing criminal investigations. The FCA stated that these platforms were suspected of facilitating P2P crypto trading without the necessary registration or anti-money laundering controls, which is a requirement under UK law for all crypto exchange providers. Currently, there are no registered P2P crypto traders or platforms in the UK.
According to Steve Smart, the FCA's Executive Director of Enforcement and Market Oversight, 'unregistered P2P crypto traders operating in the UK are acting illegally and pose a significant risk of financial crime.' Law enforcement views this operation as part of broader efforts to disrupt channels used for moving illicit funds, with DI Ross Flay of SWROCU noting that unregistered traders can enable criminals to launder and spend illegal proceeds. This action follows previous enforcement measures, including prosecutions of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. The FCA has also taken action against offshore platforms for unlawful financial promotions and expanded its oversight of social media figures promoting high-risk crypto products.
As the UK prepares to introduce a comprehensive regulatory regime for crypto by October 2027, with a licensing window set to open in September 2026, the FCA is urging consumers to verify the registration status of firms using its online register and warning of the risks associated with dealing with unregistered P2P traders, including lack of access to the Financial Ombudsman Service or compensation schemes and potential involvement in transactions with stolen funds.