UK Regulators Execute Raids on Illegal Crypto P2P Trading Hubs

The UK's Financial Conduct Authority (FCA) has conducted its first coordinated crackdown on illegal peer-to-peer (P2P) cryptocurrency trading, targeting eight locations across London. The operation was carried out in partnership with His Majesty's Revenue & Customs (HMRC) and the South West Regional Organised Crime Unit (SWROCU), resulting in the issuance of cease-and-desist notices and the collection of evidence for criminal investigations. These sites were suspected of facilitating direct crypto transactions between individuals without the mandatory registration or anti-money laundering (AML) controls required under UK law. The FCA confirmed that there are currently no registered P2P crypto traders or platforms operating legally within the country, rendering these hubs entirely illicit. Steve Smart, the FCA’s executive director of enforcement and market oversight, stated that unregistered traders pose a significant financial crime risk. Law enforcement officials added that these unregulated channels are frequently exploited by criminals to move, disguise, and spend illegal funds. This enforcement action serves as a precursor to a broader regulatory overhaul. The UK is preparing to roll out a comprehensive crypto regulatory regime by October 2027, with a formal licensing window expected to open in September 2026. Until then, the regulator continues to focus on AML compliance and the policing of financial promotions. Consumers have been urged to verify firm registrations via the FCA's online register. The regulator warned that those using unregistered P2P services lack protection from the Financial Ombudsman Service and compensation schemes, leaving them vulnerable to fraud and the risk of handling stolen funds.