UK signals end of 'light-touch' era with multi-agency raid on peer-to-peer crypto hubs
Increased enforcement coincides with detailed regulatory guidance issued to crypto firms ahead of the full framework taking effect in late 2027.
The U.K.’s Financial Conduct Authority (FCA) said Thursday that it conducted actions to crack down on three illegal peer-to-peer crypto trading locations in London in a sign the regulator is ramping up enforcement activity as the country's legal framework for crypto comes closer to implementation.
The financial watchdog, which said the crackdown was a joint effort with HM Revenue & Customs (HMRC) and London’s Metropolitan Police, said it issued cease-and-desist letters at the three premises, requiring traders to stop participating in illegal crypto businesses. Peer-to-peer trading occurs when individuals buy and sell crypto directly with each other, an activity that needs to be legally registered in the U.K.
“There are currently no FCA-registered peer-to-peer crypto businesses operating in the U.K.,” the FCA said. “By operating outside the FCA’s registration regime, they avoid controls designed to detect and prevent money laundering,” the agency said.
“This second coordinated enforcement operation in six months confirms the FCA's shift from warnings to active disruption of unregistered P2P crypto businesses, with criminal liability a live risk for any operator trading by way of business without the proper registration,” Black said.