In a coordinated effort, the UK's Financial Conduct Authority (FCA), 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 suspected of hosting illegal peer-to-peer cryptocurrency trading operations. The sites in question were allegedly operating without the necessary registration or anti-money laundering controls, posing a significant risk of financial crime.
As a result, cease-and-desist notices were issued, and evidence was gathered to support ongoing criminal investigations. The FCA has emphasized that all crypto exchange providers must register with the authority, highlighting that currently, no peer-to-peer crypto traders or platforms are legally registered in the UK. According to Steve Smart, the FCA's executive director of enforcement and market oversight, unregistered peer-to-peer crypto traders are operating illegally and pose a significant financial crime risk.
Law enforcement views this operation as part of a broader effort to disrupt the flow of illicit funds, with unregistered traders potentially enabling criminals to launder money. This action follows previous enforcement measures, 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 for unlawful financial promotions and expanded its oversight of social media figures promoting high-risk crypto products. As the UK prepares to introduce 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.