The UK is set to grant law enforcement agencies new powers to freeze crypto assets suspected of being used in crimes, without requiring a conviction, starting April 26, 2024. This move comes as part of amendments to the Economic Crime and Corporate Transparency Act 2023.
These amendments, outlined in a document released on February 29, grant the National Crime Agency (NCA) the ability to seize crypto assets suspected of involvement in illicit activities. This includes the power to directly retrieve them from exchanges and custodian wallet providers. Additionally, authorities will have the option to destroy seized assets, typically by transferring them to a “burn wallet.”
This legislation aims to bolster the NCA’s ability to combat crimes like cybercrime, scams, and drug trafficking involving cryptocurrency. It addresses concerns that traditional legal procedures might be inadequate in some cases, particularly when individuals involved are located overseas and escaping conviction.
Despite concerns about the potential effectiveness of these measures, the UK government remains committed to expanding its regulatory framework for cryptocurrencies. They plan to introduce new laws within the next six months governing stablecoins and crypto staking practices, aiming to finalize regulations before the next election scheduled for January 2025.
