The Financial Conduct Authority (FCA) has opened 24 investigations into cryptocurrency businesses.
Responding to a Freedom of Information request, the regulator also confirmed that seven whistleblower reports had been opened relating to cryptocurrency businesses so far in 2018.
The FCA confirmed that it was making enquiries into the activities of 24 unauthorised firms that are involved in some form of cryptocurrency business, to 'determine whether they might be carrying on regulated activities that require FCA authorisation'.
The response added: 'If we conclude that they are, then we may investigate and take action, identifying and determining the most serious matters which pose the greatest risk to consumers.'
In March, outgoing FCA chairman John Griffith-Jones warned that cryptocurrencies would cause consumer harm if not regulated.
The action the FCA may take ranges from issuing an alert to consumers via the FCA website to warn them about a particular individual, activity or firm, to launching civil court action to stop activity and freeze assets.
It may also pursue insolvency proceedings and, in the most serious cases, criminal prosecution.
The FCA clarified in its response that not all cryptoassets are within its regulatory perimeter.
New Model Adviser® understands that the enquiries are not related to a review into cryptocurrencies and their regulation, which is being carried out in conjunction with the Bank of England and HMRC and was announced in the FCA's 2018/19 business plan.