The U.K. could sell 61,000 seized Bitcoin, valued at over £5.4B, to address a growing fiscal deficit.
A new government framework will centralize the storage and sale of confiscated cryptocurrency assets.
The potential Bitcoin sale may impact global markets, echoing Germany’s 2024 liquidation of 50,000 BTC.
The United Kingdom is preparing to sell a massive amount of Bitcoin seized from criminal activities, potentially raising over £5 billion. According to the Telegraph report, this move is under review as Chancellor Rachel Reeves seeks ways to fill a growing fiscal gap.
The Home Office, in cooperation with law enforcement, is developing a centralized system for the sale and secure storage of cryptocurrency assets. With interest rates high and economic growth sluggish, officials are looking to seize digital assets as an alternative revenue source.
https://twitter.com/Telegraph/status/1946671430906638720 Home Office Develops Crypto Disposal Framework
The proposed “crypto storage and realisation framework” would allow law enforcement to manage seized digital assets. This includes securing the cryptocurrency and converting it into funds for the public purse. According to procurement documents, the contract for this service could be worth up to £40 million. The provider would earn commission from successful sales.
This system is intended to streamline the handling of seized crypto, which has become increasingly common in financial crimes. Law enforcement agencies already sell Bitcoin from past seizures, but the new framework aims to centralize these efforts.
2018 Seizure Drives U.K.’s Bitcoin Holdings
The largest portion of the U.K.’s Bitcoin stash came from a 2018 raid tied to a Chinese Ponzi scheme. Authorities recovered 61,000 Bitcoins from Jian Wen, who was later convicted of money laundering. At the time of the seizure, the cryptocurrency was worth around $6,000 per coin. Last week, Bitcoin prices surged to $123,000, pushing the total value of that holding to more than £5.4 billion.
Data from BitcoinTreasuries shows the U.K. is now the third-largest government holder of Bitcoin, behind only the U.S. and China. If sold, the funds could cover major portions of recent government spending or welfare reversals.
Treasury Considers Revenue Potential
While the decision to sell Bitcoin belongs to law enforcement, the Treasury is closely monitoring the situation. Proceeds from sales not returned to victims are split between the central government and local law enforcement. In many cases, the Treasury retains 20 to 30 percent of the total amount.
Experts in asset recovery said crypto seizures could significantly increase annual government revenue. Since 2019, U.K. agencies have frozen and seized £1.4 billion in criminal assets. A greater focus on digital crime could double that figure.A complete sale could place downward pressure on the Bitcoin market, similar to Germany’s sale of 50,000 BTC last year. At that time, the price dropped by over $10,000 in a day. The U.K.’s holdings could cause similar volatility. While some politicians back creating a national crypto reserve, the Labour government opposes it. Officials cite Bitcoin’s price instability as a reason to avoid adopting it as a sovereign asset.
