The UK government plans to sell over £5 billion in seized Bitcoin to ease pressure from a growing national budget gap.
Ongoing legal claims from Ponzi scheme victims may delay the UK’s plan to sell Bitcoin seized during a 2018 fraud case.
A cancelled £40 million contract for crypto storage has slowed efforts to manage and sell the UK’s seized Bitcoin assets.
The UK government is preparing to sell a large amount of seized Bitcoin. The cryptocurrency, valued at over £5 billion, was confiscated during various criminal investigations. A major portion includes 61,000 Bitcoin seized in 2018. That seizure was linked to a Chinese Ponzi scheme. Authorities recovered the Bitcoin after the suspect attempted to buy property using digital assets.
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The Home Office, alongside police forces, is working on a system to manage and sell these assets. The plan aims to support the country’s strained public finances. Finance Minister Rachel Reeves is reportedly overseeing the effort. The Treasury hopes the sale will offer a significant revenue source.
Legal Disputes and Ownership Claims
Despite the government’s plans, legal complications may delay the sale. The 2018 Bitcoin seizure is being contested by victims of the Ponzi scheme. These victims claim the digital assets were stolen and should be returned. Chinese authorities have backed the victims’ appeal.
The High Court has been asked to approve the government's claim over Bitcoin. Officials want permission to keep and sell the assets. If approved, the government could use proceeds to support public funds. However, the legal case remains unresolved. Any sale depends on court decisions regarding ownership rights.
Framework for Storage and Sale
To handle Bitcoin securely, the government launched a procurement process. It invited firms to bid on a £40 million contract. The contract would establish a system for storing and selling digital assets. However, no bid met the required standards. The tender was cancelled in July.
Authorities plan to reopen the bidding process with revised terms. The framework is essential to manage the sale efficiently. Without a proper system, the sell-off cannot proceed. Experts note that delays may also affect the potential value of the assets. Market conditions could change before a sale is complete.
Use of Proceeds and Budget Relief
Any revenue from the sale would follow crime proceeds law. Funds may first compensate verified victims. After that, remaining amounts could go to the Treasury. Police agencies involved in the seizure may also receive a share. The government sees this as a rare opportunity to ease fiscal pressures.
Budget deficits and rising debt costs have intensified the need for new revenue sources. The potential sale offers billions in relief. However, comparisons have been made to past asset sell-offs. Critics warn the government against acting too quickly without resolving legal claims.
