The UK Financial Conduct Authority (FCA) has carried out its first coordinated multi-agency operation targeting illegal peer-to-peer cryptocurrency trading, visiting eight premises across London and issuing cease-and-desist letters at each site.
FCA Raids Eight London Premises in First Crackdown on Illegal Peer-to-Peer Crypto Trading
23 April 2026 - 12:50 CEST
Officers gathered evidence during the on-site inspections, which is now supporting a number of ongoing criminal investigations. The action was conducted with HM Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU) under the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017.
Targeting grey market
The operation signals the FCA’s determination to disrupt unregistered activity as the UK prepares for the introduction of its comprehensive cryptoasset licensing regime. The full regime is scheduled to take effect on 25 Oct 2027, with the authorization gateway expected to open on 30 Sep 2026.
Peer-to-peer trading allows individuals to buy and sell crypto directly with one another, bypassing centralized exchanges. Such activity requires appropriate registration and anti-money laundering controls.
However, there are currently no FCA-registered peer-to-peer crypto traders or platforms operating in the UK.
Unregistered platforms therefore lack the safeguards and can be exploited for financial crime. The UK Government’s National Risk Assessment of Money Laundering and Terrorist Financing notes that cryptoassets are increasingly used to launder the proceeds of crime, with peer-to-peer trading offering avenues to layer transactions and evade know-your-customer (KYC) requirements.
Disrupting routes for illicit funds
Steve Smart, executive director of enforcement and market oversight at the FCA, said: "Unregistered peer-to-peer crypto traders operating in the UK are doing so illegally and pose a financial crime risk. We will use our powers and work with partners to disrupt them."
DI Ross Flay of SWROCU added: "By working with our colleagues at the FCA and HMRC, we are able to effectively target and disrupt unregistered peer-to-peer crypto traders operating illegally. As law enforcement, we want to stop these traders providing a route for criminals to move, disguise and spend illegal money."
Imogen Makin, counsel at law firm WilmerHale in London, said: "The resources and coordination deployed in this operation show that the FCA isn’t just making statements about its areas of focus, it is acting on them. It seems likely that we will continue to see similar crackdowns in future as the FCA remains focused on combatting the risks associated with crypto and financial crime."
Ownership decline amid rising caution
According to the FCA’s Cryptoassets Consumer Research 2025, cryptoasset ownership among UK adults fell to 8% (approximately 4.5mn people) from 12% the previous year, yet those who continue holding assets are committing larger sums, with more portfolios exceeding £1,000. High-profile enforcement actions, combined with growing awareness of risks linked to unlicensed platforms, appear to have encouraged more cautious behaviour among retail investors.
Preparing for full compliance
The crackdown comes as legitimate market participants have more than a year to ready themselves for the new regulatory regime. The firm stance is expected to accelerate preparation among firms planning to seek authorization once the gateway opens in September 2026. This could channel liquidity and innovation toward compliant, regulated platforms, while raising barriers for those operating outside the rules.
In contrast, the US Guiding and Establishing National Innovation for US Stablecoins (GENIUS) Act, passed in July 2025, focuses primarily on stablecoins with a target implementation date of January 2027. The UK regime adopts a broader scope, covering a wide range of cryptoasset activities including trading, custody and promotions.
