In a coordinated effort, the UK's Financial Conduct Authority, in collaboration with HM Revenue & Customs and the South West Regional Organised Crime Unit, has conducted a sweep of eight locations in London, targeting unregistered peer-to-peer crypto trading operations. The action, which included the issuance of cease-and-desist orders and the collection of evidence for ongoing criminal investigations, aims to curb unauthorized crypto trading activities.
According to the FCA, these platforms, which enable individuals to buy and sell cryptocurrencies directly, were operating without the requisite registration or anti-money laundering safeguards. Under UK law, crypto exchange providers must register with the FCA, yet currently, no peer-to-peer crypto traders or platforms are registered. The FCA's Executive Director of Enforcement and Market Oversight, Steve Smart, emphasized that unregistered peer-to-peer crypto traders are operating illegally and pose a significant risk of financial crime. Law enforcement views this operation as part of broader efforts to disrupt the flow of illicit funds, with unregistered traders potentially facilitating the laundering of criminal proceeds.
This enforcement action builds upon previous efforts, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. The move comes ahead of the UK's planned expansion of its regulatory framework for crypto assets by October 2027, with a licensing window set to open in September 2026.
The FCA advises consumers to verify the registration status of firms using its online register and warns of the risks associated with dealing with unregistered entities, including lack of access to the Financial Ombudsman Service or compensation schemes and potential involvement in transactions involving stolen funds.