UK government introduces Bill to clarify cryptocurrency's legal status in England and Wales

Under the Bill, cryptocurrency, non-fungible tokens (such as digital art) and carbon credits will be considered as personal property under the law for the first time in UK history. Previously, such digital assets were not included in the scope of England and Wales property law.

The Bill will also give owners and companies more legal protection against fraud and scams, the government says. It will also help judges deal with complex cases where digital holdings are disputed or form part of settlements, for example in divorce cases.

The government also notes that the Bill will better equip the legal sector to respond to new technologies, saying: ‘It is essential that the law keeps pace with evolving technologies and this legislation will mean that the sector can maintain its position as a global leader in crypto-assets and bring clarity to complex property cases.’

The legislation comes in response to the Law Commission of England and Wales’ (the Law Commission’s) 2023 report on digital assets.

The Law Commission made a further recommendation in the report that the government should set up an expert group on control of digital assets. The government has therefore asked the UK Jurisdiction Taskforce to take this recommendation forward.

HM Treasury is expected to review other recommendations from the report, including setting up a multi-disciplinary project to formulate a statutory framework for the operation and enforcement of certain crypto-token and crypto-asset collateral arrangements. Parliament has said that the treasury will provide an update on this ‘in due course’.

Sources

• UK government
• UK parliament (government statement)
• UK parliament (text of Bill)
• Law Commission