Britain’s Financial Conduct Authority said it had carried out its first operation to disrupt illegal peer-to-peer crypto trading, targeting eight premises across London.
In a joint action with HMRC and the South West Regional Organised Crime Unit, the FCA said it moved against eight suspected trading locations in London, issued warnings ordering operators to cease the activity, and secured evidence that is now part of continuing criminal investigations.
The regulator said peer-to-peer crypto transactions take place directly between individuals rather than on a centralized exchange, and noted that there are no FCA-registered traders or platforms in that category currently operating in the UK.
FCA Warns Traders Are Operating Illegally
Steve Smart, executive director of enforcement and market oversight at the FCA, said unregistered peer-to-peer crypto traders operating in the UK were doing so illegally and posed a financial crime risk.
He said the FCA would use its powers and work with partners to disrupt them. Smart also said consumers should protect themselves by dealing only with firms registered with the FCA and should remember that crypto remains a high-risk investment.
Agencies Say Crackdown Targets Criminal Money Flows
DI Ross Flay of SWROCU said cooperation with the FCA and HMRC allowed authorities to target and disrupt unregistered peer-to-peer crypto traders operating illegally.
He added that law enforcement wanted to stop such traders from providing a route for criminals to move, disguise and spend illegal money.
The FCA said it had previously taken action against unregistered cryptoasset activity in the UK, including prosecuting an individual operating an illegal network of crypto ATMs.
The regulator added that the government’s National Risk Assessment of Money Laundering and Terrorist Financing has outlined how cryptoassets are increasingly used to launder the proceeds of crime, and said it would continue working with domestic and international partners to fight financial crime and protect consumers.
Broader Crypto Rules Taking Shape
The enforcement action comes less than a week after the FCA outlined its plans for how crypto will be regulated in the UK. In a recent consultation, the regulator asked for feedback on how it should oversee a range of crypto activities, including stablecoin issuance, trading platforms, custody, dealing, arranging transactions and staking.
The proposed system would regulate firms based on the specific crypto activities they carry out rather than under a single blanket license. Applications are expected to open in September 2026, with the wider regime due to take effect in October 2027, bringing more of the sector under formal oversight.
