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 series of raids on eight locations in London, targeting unlicensed peer-to-peer crypto trading platforms. The operation resulted in the issuance of cease-and-desist notices and the collection of evidence for ongoing criminal investigations. The FCA has stated that these platforms were suspected of facilitating peer-to-peer crypto trading without the necessary registration or anti-money laundering measures, posing a significant risk of financial crime. Under UK law, crypto exchange providers are required to register with the FCA, and currently, there are no registered peer-to-peer crypto traders or platforms in the country.
According to Steve Smart, the FCA's executive director of enforcement and market oversight, 'unregistered peer-to-peer crypto traders operating in the UK are doing so illegally and pose a financial crime risk.' The operation is part of a broader effort to disrupt the movement of illicit funds, with law enforcement agencies highlighting the role of unregistered traders in enabling criminals to launder money. This crackdown builds on previous enforcement actions, including the prosecution 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 and social media figures promoting high-risk crypto products. As the UK prepares to introduce a new regulatory regime for crypto by October 2027, 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 compensation schemes and the potential for transactions involving stolen funds.