Nils Silinevics
Partner · AML & Crypto Compliance · Former FIU Investigator
Exodus is a non-custodial wallet — Financial Conduct Authority (FCA) does not regulate it. But if you send funds to an exchange, the exchange can freeze them. Here's how to protect yourself and what to do if it happens.
Exodus is non-custodial — FCA does not regulate self-custody wallets; UK users self-custody
FCA's cryptoasset register is mandatory — only registered firms can market crypto to UK consumers; FCA has warned 300+ firms for operating without registration
This matters because it determines which regulatory body has authority over your case — and whether you have a direct complaint path or need cross-jurisdictional legal action.
What this means for you: Exodus is non-custodial — Financial Conduct Authority (FCA) does not regulate it. Your wallet cannot be frozen. However, if you send funds to a centralized exchange, the exchange can freeze them. The issue is not with Exodus but with the receiving exchange.
under MLR 2017, you can complain to the Financial Ombudsman Service (FOS) if the exchange is FCA-registered — FOS can award up to £430,000 compensation
Under Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLR 2017, amended), Exodus must conduct customer due diligence and can freeze accounts during AML investigations. However, they must also:
If Exodus doesn't meet these obligations, we escalate to Financial Conduct Authority (FCA) and file a formal legal submission. For a broader comparison of how United Kingdom's rules stack up against other jurisdictions, see our AML laws by country reference.
capital gains tax (10% or 20%) on gains above £3,000 (2024-25 allowance); income tax if trading
If your Exodus account is frozen, you may still need to declare your crypto holdings on your United Kingdom tax return — even if you can't access them. Under United Kingdom law, the tax obligation may apply regardless of whether the funds are accessible. We recommend consulting a British tax advisor.
If the freeze causes you to miss a tax deadline, we can provide documentation for the Financial Conduct Authority (FCA) and tax authority explaining the situation.
A British user of Exodus (non-custodial wallet) tried to send funds to an exchange, but the exchange froze the deposit citing Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLR 2017, amended). The exchange flagged the Exodus address as high-risk. We prepared documentation showing legitimate acquisition of funds. Within 14 days, Exodus released the funds after our submission demonstrated compliance with Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 (MLR 2017, amended).
Details anonymized to protect client confidentiality. Swiss professional secrecy applies.
We analyze your Exodus account, transaction history, and United Kingdom regulatory context to identify the exact trigger. Was it a none (non-custodial) risk flag? A sanctions screening match? A source-of-funds demand? Each requires a different strategy.
We prepare documentation compliant with Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 — not just Exodus's standard templates. This includes source-of-funds proof, transaction tracing, and any required Financial Conduct Authority-specific forms.
We submit through Exodus's compliance channels — not standard support. Our submission is in English and references Financial Conduct Authority guidelines. We coordinate with Financial Conduct Authority even though Exodus is not registered.
We verify everything works and advise on preventing recurrence on Exodus. If Exodus doesn't respond within no statutory maximum, but FCA expects firms to resolve AML investigations within 30 days, we escalate to Financial Conduct Authority and pursue cross-jurisdictional action in USA (Nebraska; publicly traded: EXOD) if needed.
Tell us what happened. A senior crypto compliance lawyer — not a chatbot, not a junior — will read your case and respond within 6 hours. Swiss professional secrecy applies from your first message.