The government of the United Kingdom has recently issued official documents stating that law enforcement authorities in the country will have the power to freeze cryptocurrency assets linked to criminal activities without requiring a conviction. These amendments to the Economic Crime and Corporate Transparency Act 2023 expand the authority of the National Crime Agency to confiscate and seize suspicious crypto assets without the need for lengthy legal procedures. The changes also allow authorities to directly retrieve crypto assets from exchanges and custodian wallet providers, and even destroy the assets if necessary. Although the process of asset destruction was not outlined, the most common method involves burning the tokens and removing them from circulation. The new law will come into effect on April 26.
The legislation, which was passed in September 2022, aims to enhance the ability of authorities to combat the use of cryptocurrency in crimes such as cybercrime, scams, and drug trafficking. One provision of the law allows for the recovery of crypto assets used in crimes without the need for an arrest, as some individuals may evade conviction by remaining overseas. However, a British victim of crypto fraud who lost around $46,000 to scammers has criticized the authorities, claiming that they may not be adequately equipped to handle crypto crimes against UK residents. According to him, the agency failed to take appropriate measures to recover his stolen funds.
In the meantime, the UK government plans to introduce new regulations for stablecoins and crypto staking within the next six months. During a crypto event in London, Economic Secretary to the Treasury Bim Afolami revealed that the government aims to complete the regulation before the next election, which is scheduled to take place no later than January 28, 2025.