The Financial Conduct Authority has launched its largest coordinated enforcement action against decentralised finance platforms, issuing warnings and restriction orders to 23 DeFi protocols that it alleges have been marketing unregistered financial products to UK consumers. The action targets platforms offering lending, yield farming, and derivatives services without appropriate authorisation, with the FCA estimating that UK consumers have deposited approximately £1.8 billion into unregistered DeFi protocols over the past twelve months. The regulator has also added 47 new entries to its warning list of unauthorised crypto firms.

The enforcement push reflects the FCA's evolving interpretation of how existing securities law applies to decentralised protocols. In an accompanying policy statement, the regulator argued that many DeFi platforms are "decentralised in name only," with identifiable development teams, governance token holders, and treasury functions that bring them within the scope of UK financial regulation. The FCA has specifically targeted front-end interfaces accessible from UK IP addresses, issuing takedown notices and working with internet service providers to restrict access. Legal experts at Clifford Chance noted that the action establishes an important precedent for how regulators worldwide approach DeFi enforcement.

The DeFi industry has pushed back strongly against the FCA's approach. Lobby group DeFi Education Fund argued that enforcement actions against protocol interfaces do not address the underlying smart contracts, which continue to operate on public blockchains regardless of front-end restrictions. However, the FCA's head of digital assets, Matthew Long, countered that "the vast majority of retail consumers interact with DeFi through web interfaces, and our duty is to protect those consumers from unregulated risk." The regulator has indicated that a formal consultation on bespoke DeFi regulation will be published in Q2 2026.