In a landmark operation, the UK's Financial Conduct Authority (FCA), in collaboration with HM Revenue & Customs and the South West Regional Organised Crime Unit, has launched a crackdown on unauthorized peer-to-peer cryptocurrency trading, targeting eight locations across London. Authorities issued cease-and-desist orders and collected evidence for multiple ongoing investigations. The targeted platforms were allegedly operating without the required registration or anti-money laundering controls, which is mandatory for crypto exchange providers in the UK. According to the FCA, there are currently no registered peer-to-peer crypto traders or platforms in the country, making these operations illegal and a potential conduit for financial crime.
The FCA's executive director of enforcement and market oversight, Steve Smart, emphasized that unregistered traders pose a significant financial crime risk. Law enforcement views this operation as part of a broader effort to disrupt the flow of illicit funds.
The action follows previous enforcement measures, including the prosecution of operators of unauthorized crypto ATMs and collaboration with police to apprehend individuals linked to unregistered crypto exchanges. Last year, the FCA also took action against an offshore platform for unlawful financial promotions and expanded its oversight of social media influencers promoting high-risk crypto products.
As the UK prepares to introduce a comprehensive regulatory framework for crypto by October 2027, with a licensing window set to open in September 2026, the FCA has urged consumers to verify the registration status of firms using its online register and warned of the risks associated with dealing with unregistered traders, including lack of access to the Financial Ombudsman Service or compensation schemes and potential involvement in transactions with stolen funds.