The Financial Conduct Authority (FCA), working with the Metropolitan Police Service, conducted and operation to arrest two individuals suspected of running an illegal cryptoasset exchange.

The regulator said that more than £1 billion of unregistered cryptoassets are believed to have been bought and sold through this business.

During searches at two London properties, the police seized several digital devices. The FCA interviewed both suspects under caution and they were released on bail. The FCA’s investigation into the case continues.

Since 2021, to operate in the UK, cryptoasset exchange providers must be registered with the FCA and comply with the UK money laundering regulations.

Charlotte Tregunna was quoted in The Cointelegraph, commenting on the development. She explained that since the registration requirements have been in place for several years, the individuals in this case would find it “difficult to persuade the FCA” that they were not aware of them.

“Even more so if they had applied to the FCA previously for registration, and were one of the 86% [of exchanges] who have been rejected, and carried on regardless.

“While this might be a case the FCA point to in the future as a successful demonstration of its ability to crack down on exchanges operating illegally, it might also be a sad indictment of the fact that regulatory clarity for market participants and service providers is still in limbo.”

Charlotte added that the upcoming general election would have “disrupted” the country’s path to full crypto regulation. She said:

“Whomever wins the election in July should make it a priority to steer the UK back onto the regulatory path it was previously heading towards. And they should pick up the pace while they’re at it!”