• Two people were arrested by the Financial Conduct Authority and the Metropolitan Police for allegedly operating a $1.3 billion illegal crypto business.

• The FCA said it will do everything in its power to stop crypto firms from operating illegally.

The Financial Conduct Authority (FCA) and London's police force arrested two people suspected of operating an illegal $1.3 billion crypto business.

"More than 1 billion [pounds] of unregistered crypto assets are believed to have been bought and sold through this business," the regulator said in a press release on Thursday.

The suspects, aged 38 and 44, were interviewed under caution by the FCA and released on bail. During the investigation, the FCA inspected the offices associated with the two and the Metropolitan Police seized several digital devices during searches in two London residential properties.

The investigation continues. The FCA declined to add any further details.

Since January 2021, crypto asset services must be registered with the FCA under its anti-money laundering rules. So far, just 44 companies have succeeded in landing on the register despite over 300 businesses trying.

The U.K. also recently awarded the police with more powers to seize and freeze crypto and crypto-related items when conducting investigations.

"The FCA has an important role to play in keeping dirty money out of the U.K. financial system," Therese Chambers, the FCA's executive director of enforcement and market oversight, said in the statement. "These arrests show we will do everything in our power to stop crypto firms from operating illegally in the U.K."

The regulator may be leaning more into its enforcement powers after being called out by the U.K.'s spending watchdog, the National Audit Office, late last year for being too slow to take enforcement action.