The UK government plans to liquidate more than £5 billion in seized Bitcoin to reduce the budget deficit.
This plan faces many legal challenges due to most cryptocurrencies being related to unresolved criminal cases, causing significant controversy in the financial and legal communities.
MAIN CONTENT
The UK is preparing to sell over £5 billion in seized Bitcoin, mainly related to criminal investigations.
The controversial liquidation plan is due to ongoing legal lawsuits and compensation demands from victims.
This move could have a significant impact on the cryptocurrency market and the national financial reputation.
What is the UK government's policy on selling Bitcoin?
The UK government, in coordination with the Home Office and law enforcement agencies, is building a centralized mechanism to store and sell seized cryptocurrency assets to address the budget deficit.
According to The Telegraph, the 'cryptocurrency storage and liquidation framework plan' is expected to convert over £5 billion in Bitcoin seized from criminal investigations accumulated over many years, including 61,000 BTC seized in 2018. This plan is being accelerated amid increasing national budget pressures.
What major difficulties does the UK face?
Selling the seized Bitcoin, which holds immense value, is not straightforward due to ongoing legal lawsuits.
Most of the Bitcoin, especially 61,000 BTC from a multi-level marketing scam case in China in 2018, is still in dispute between the parties involved, including victims seeking restitution. This complicates the sale with many legal barriers and complexities regarding ownership.
Bitcoin is still embroiled in legal disputes. The Chinese authorities and victims are seeking to reclaim their assets. The sale cannot occur until legal procedures are completed.
Susie Violet Ward, CEO of Bitcoin Policy UK, July 20, 2025
What is the impact of liquidating this large amount of Bitcoin?
Liquidating a large amount of Bitcoin to balance the budget could have long-lasting effects on the financial reputation of the UK, while also demonstrating a lack of strategy in managing cryptocurrency assets.
The analyst compares this event to the gold sale in 1999 under Prime Minister Gordon Brown, when the UK sold 401 tons of gold at a record low price, causing billions in losses for the nation. Many experts warn that history could repeat itself with Bitcoin.
Deciding to liquidate such a large amount of cryptocurrency could cause serious strategic and financial losses, repeating the mistake of selling gold in 1999.
James Norton, Financial and Blockchain Expert, 2025
How will the Bitcoin market react when the news is announced?
On July 19, 2025, Bitcoin's price experienced slight fluctuations, dropping to around $116,000 before recovering to $119,255.43, an increase of 0.88% in 24 hours according to CoinMarketCap.
Although the fluctuations are not too large, news of the large-scale Bitcoin sale makes investors wary of potential volatility and the ripple effects in the global cryptocurrency market.
What could happen if the UK proceeds with the sale of this Bitcoin?
A strong sell-off by the UK government could cause panic in the market, reducing liquidity and triggering multiple leveraged position liquidations, leading to a deeper decline in cryptocurrency prices.
Analysts believe there are two possible scenarios: Bitcoin may temporarily decline to retest support levels, leading to positive long-term adjustments, or other cryptocurrencies beyond Bitcoin may suffer greater losses as they lose recent growth momentum.
Regardless of the developments, the market needs to prepare psychologically to face strong volatility in the near future.
Frequently Asked Questions
1. Why does the UK government want to sell the seized Bitcoin?
The government uses the sale of Bitcoin to recover funds, reducing the ever-widening budget deficit.
2. Why is the sale of this Bitcoin facing legal troubles?
Many seized BTC related to criminal cases are in litigation, and victims seeking restitution have not been resolved.
3. How does the sale of a large amount of Bitcoin affect the market?
Price volatility may occur, reducing liquidity and leading to many complex liquidation phenomena in the cryptocurrency market.
4. What scenarios could occur with Bitcoin if the sale takes place?
Bitcoin may slightly decline to adjust to support levels, or altcoins may weaken more due to indirect effects.
5. What lessons can be learned from the past asset sales of the UK?
Similar to the failed gold sale in 1999, selling important assets without a strategy will cause long-term damage.
Source: https://tintucbitcoin.com/bitcoin-anh-ban-5-ty-bang-thi-truong-ra-sao/
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