In a first-of-its-kind coordinated effort, the U.K.’s Financial Conduct Authority (FCA), alongside His Majesty’s Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), launched an operation targeting eight illegal peer-to-peer crypto trading hubs in London. The agencies issued cease-and-desist notices at these locations and collected evidence to support ongoing criminal investigations, as per FCA reports.
The sites were suspected of engaging in unregulated P2P cryptocurrency transactions without the necessary registration or anti-money laundering safeguards. U.K. regulations mandate that all crypto exchange providers must be registered with the FCA, yet no peer-to-peer platforms are currently officially recognized.
Steve Smart, executive director of enforcement and market oversight at the FCA, highlighted that unregistered P2P traders in the U.K. operate illegally and increase financial crime risks. DI Ross Flay from SWROCU emphasized that these entities enable illicit fund movement by allowing criminals to hide and spend illegal money.
This operation is an extension of previous enforcement activities, where the FCA has previously prosecuted operators of unauthorized crypto ATMs and collaborated with police on arrests related to unregistered exchanges in 2024. Additionally, the agency targeted offshore platform HTX for unlawful promotions last year and increased monitoring of social media influencers promoting high-risk crypto products.
With a comprehensive regulatory framework set to be implemented by October 2027, including an anticipated licensing period starting September 2026 focused on anti-money laundering measures and financial promotions, the crackdown underscores ongoing efforts to tighten crypto regulations. The FCA advises consumers to verify firm registrations via its online register, cautioning that dealing with unregistered P2P traders can lead to risks such as lack of access to the Financial Ombudsman Service or compensation schemes, especially if transactions involve stolen funds.