UK watchdog leads first crackdown on illegal crypto trading in London

The UK Financial Conduct Authority has led its first coordinated operation against illegal peer to peer crypto trading, targeting eight London premises suspected of operating without registration and issuing cease and desist letters at each site.

The watchdog said evidence gathered during the inspections is supporting several ongoing criminal investigations.

The FCA carried out the operation with HM Revenue & Customs and the South West Regional Organised Crime Unit under the UK’s money laundering and terrorist financing rules. The regulator said there are currently no FCA registered peer to peer crypto traders or platforms operating in the UK, meaning any such activity requires scrutiny and may be unlawful.

Steve Smart, the FCA’s executive director of enforcement and market oversight, said unregistered peer to peer crypto traders in the UK are operating illegally and pose a financial crime risk. Police officials involved in the operation said these traders can provide a route for criminals to move, disguise, and spend illicit funds.

In February, the FCA moved against HTX over allegedly illegal crypto promotions in the UK, marking its first enforcement action against a crypto firm for unlawful marketing under the current regime.

The latest action also comes just a week after the FCA launched a consultation on the next phase of UK crypto regulation, including rules for trading platforms, dealing, staking, and safeguarding cryptoassets, ahead of a broader framework due to take effect in October 2027.