Cryptocurrency Assets Frozen in UK Following New Regulatory Powers Activation

MailOnline's investigation reveals that UK authorities have frozen around £6 million ($7.7 million) in cryptocurrency since the implementation of new enforcement measures last year.

The new rules, enforced in April 2024, enable police, law enforcement agencies, and HMRC to seize suspicious cryptocurrency wallets for up to three years.

An examination of court documents over the past six months indicates the largest single freezing order involved £1.5 million worth of cryptocurrency from a wallet managed by US-based exchange Coinbase.

HMRC sought this order, which was issued at Newcastle Upon Tyne Magistrates' Court on March 18.

The actual frozen amount may be higher, as court data from Courtsdesk covers only the past six months due to legal limitations. These new powers aim to tackle the increasing use of digital currencies for money laundering, tax evasion, and financing terrorism.

Legal experts provide varying opinions on the significance of these seizures. Nick Barnard, a partner at Corker Binning and specialist in cryptocurrency law, views the £6 million figure as relatively modest "in the grand scheme." Barnard observes that the new enforcement system started from scratch last April and needs time to reach its full potential.

However, lawyer Siobhain Egan informed MailOnline that the government is funneling more resources toward freezing cryptocurrency assets. This is part of a proactive strategy to combat money laundering and terrorism financing, Egan points out.

The freezing process typically consists of investigators requesting orders without informing the suspected criminals, thereby preventing them from moving Bitcoin (BTC) or other cryptocurrencies.

"If police are conducting a major investigation into organized criminals laundering money through crypto, they will confiscate the assets before concluding the investigation," Egan clarified.

The UK government is enhancing its cryptocurrency enforcement efforts through the Crime and Policing Bill. The bill includes provisions for valuing cryptocurrency, establishing procedures for courts to recover illicit funds, and expanding the Crown Court's powers to issue seizure orders.