Britain’s Financial Conduct Authority said on Tuesday it has stopped 26 machines across the country for illegally offering cryptocurrencies, warning consumers they could lose all of their money.

A member of the public paid a thousand pounds into a crypto ATM in Sheffield, northern England, in an attempt to buy cryptocurrencies, but no cryptocurrency or funds were returned, the FCA said.

The watchdog, in a coordinated operation with other law enforcement agencies, inspected 34 locations suspected of hosting crypto ATMs since the start of this year and “disrupted” 26 machines.

“If you use a crypto ATM in the UK, you are using a machine that is operating illegally and you may be handing your money over to criminals,” Steve Smart, joint executive director of enforcement and market oversight at the FCA, said in a statement.

“You will not be protected if something goes wrong, and you could lose your money,” Smart said.

British consumers buying crypto assets will get a 24-hour “cooling-off” period for the first time from October under tougher marketing rules unveiled by the financial regulator in June.

Crypto assets, such as Bitcoin, have little direct regulation globally, but regulators are taking a closer look after the downfall of FTX last year, which left millions of investors nursing losses totalling billions of dollars, some of them in Britain.

The Financial Conduct Authority (FCA) said “refer a friend” bonuses for crypto buyers would also be scrapped and that those promoting such assets would have to put in place clear risk warnings and ensure adverts were clear, fair and not misleading.

© Thomson Reuters 2023

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