UK signals the end of its ‘light-touch’ approach with coordinated action against peer-to-peer crypto hubs
Stricter enforcement coincides with detailed regulatory guidance issued to crypto firms ahead of the full framework taking effect in late 2027.
— Britain’s Financial Conduct Authority, working with tax authorities and the Metropolitan Police, ordered traders at three London locations to stop running illegal peer-to-peer cryptocurrency businesses.
— The FCA said no peer-to-peer cryptocurrency businesses are registered in Britain, meaning operators outside its regime evade safeguards intended to detect and prevent money laundering.
— Britain’s cryptocurrency framework takes full effect on Oct. 25, 2027, and firms may apply for FCA approval from Sept. 30 through Feb. 28, 2027.
The U.K.’s Financial Conduct Authority (FCA) said Thursday that it took action against three illegal peer-to-peer crypto trading locations in London, signaling that the regulator is increasing enforcement as the country’s legal framework for crypto approaches implementation.
The financial watchdog, which said the operation was conducted with HM Revenue & Customs (HMRC) and London’s Metropolitan Police, 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 one another, an activity that must 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. Operators outside the registration regime avoid controls designed to detect and prevent money laundering.
The action indicates that the era of light-touch crypto regulation in the U.K. is ending, according to Caroline Black, a consultant at Gherson Solicitors LLP.
Black said the second coordinated enforcement operation in six months confirms the FCA’s move from warnings to active disruption of unregistered P2P crypto businesses, with criminal liability a real risk for anyone operating such a business without proper registration.
Aditya Mittal, managing principal at Capco, a global management and technology consultancy, said firms should focus on understanding which parts of their businesses fall within the scope of the U.K.’s incoming cryptoasset regime, following the FCA’s guidance earlier in the week.
The guidance covers issuing qualifying stablecoins, operating crypto exchanges, dealing and coordinating deals, safeguarding digital assets and staking. It also explains which activities require FCA approval. The application window runs from Sept. 30 to Feb. 28, 2027, and the U.K. crypto regulatory framework comes into full force on Oct. 25, 2027.
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases and RLUSD’s role.
Why it matters:
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases and RLUSD’s role.
