In a coordinated effort, the UK's Financial Conduct Authority, alongside His Majesty's Revenue & Customs and the South West Regional Organised Crime Unit, has conducted a series of raids on eight sites in London suspected of operating as unregistered peer-to-peer crypto trading hubs. The operation resulted in the issuance of cease-and-desist orders and the collection of evidence for ongoing criminal investigations. According to the FCA, these sites facilitated direct crypto transactions between individuals without adhering to the required registration and anti-money laundering protocols. Under current UK law, crypto exchange providers must register with the FCA, with no registered peer-to-peer crypto traders or platforms currently operating in the country.
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. This operation is part of broader efforts to disrupt the flow of illicit funds, with law enforcement officials highlighting the role of unregistered traders in enabling the movement and laundering of illegal money.
The action follows previous enforcement measures, including the prosecution of operators of illegal crypto ATMs and the arrest of individuals linked to unregistered crypto exchanges. Additionally, the FCA has 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 implement a more comprehensive regulatory framework 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 the lack of access to the Financial Ombudsman Service or compensation schemes and the potential involvement of stolen funds in transactions.