New powers brought in relating to crypto-assets

Written 21st May 2024 by James Claughton

UK law enforcement agencies now have greater powers relating to seizure, freezing and destruction of crypto-assets.

Law enforcement agencies have long held powers relating to the seizure and recovery of assets when investigating the sources of suspected criminal funds. However, this has been much more complicated when crypto assets are involved.

How are crypto-assets used criminally?

Crypto-assets have become a major element of criminality in the UK and beyond, as they can be used to facilitate the transfer of high value assets and proceeds of crime which can be difficult to trace. The use of crypto assets is yet further evidence of how criminals are often much quicker at adapting to and indeed exploiting new technologies and methods to further their criminal enterprises.

Crypto – assets are stored on a block chain and transactions are unregulated which affects the ability to track and ultimately seize or recover assets. The National Crime Agency estimates that illicit crypto transactions linked to the UK are likely to have amounted to at least £1.2 billion in 2021 and the actual amount could be significantly higher.

In January 2024, the National Crime Agency worked with the US Drug Enforcement Administration to investigate a drug operation which resulted in $150 million in cash and crypto being seized. Furthermore, 3 men were sentenced for over 30 years for trafficking £750,000 worth of counterfeit drugs for crypto.

New powers to seize crypto-assets

The new powers now allow UK authorities to seize crypto-assets suspected to relate to criminal activity.

The Economic Crime and Corporate Transparency Act 2023 (ECCTA) amended The Proceeds of Crime Act 2002 (POCA) from 26 April 2024 and is designed to stop the legitimate use of crypto being destabilised and simultaneously enable the use of crypto as a way to assist with growth of the UK’s economy. The legislation represents major changes to seizure and recovery of assets.

The new changes are designed to enable authorities to protect assets from being traded, withdrawn or destroyed whilst an investigation is ongoing and to allow recovery of assets found to be linked to criminal activity. Law enforcement will now be able to seize digital wallets suspected of containing illegal funds, this is intended to get past the difficulties with crypto of unregulated market.

The changes include:

  • The police no longer need to arrest a suspect before seizing crypto assets.
  • Items such as written passwords/memory sticks can be seized.
  • Law enforcement officers can transfer illicit crypto – assets into electronic wallets.
  • Law enforcement officers can destroy crypto – assets if returning into circulation is ‘not conducive to the public good’.
  • Victims of crypto related fraud can apply for monies belonging to them to be released back to them.

Of the new powers, Home Secretary James Cleverly commented:

“Criminals should never be able to benefit from breaking the law which is why we are making it much easier for law enforcement to stay on top of a new and developing threat.
These reforms will also enhance our national security. Terrorist organisations like Daesh are known to raise funds through crypto transactions and these updated powers will enable our agencies to more easily strip them of their assets.”

Adrian Searle, Director of the National Economic Crime Centre, said: 

“Criminals are increasingly using crypto assets to conceal and move the proceeds of crime at scale and pace, pay for other criminal services, and as a means to defraud victims.” 

He also said: “These new powers are very welcome and will enhance law enforcement’s ability to restrain, recover and destroy crypto assets if required.”

Consequences of the new legislation

The ramifications of the new legislation will be far reaching but it remains to be seen as to how they will be enforced in practice. The new provisions do however show that the UK government are clamping down on criminal activity related to crypto and this could quite easily result in a greater number of investigations and prosecutions.

Olliers Solicitors – specialist criminal defence solicitors

Our specialist defence solicitors can provide advice and assistance to those who may find themselves being investigated or face prosecution in relation to allegations involving crypto-assets. Please contact our specialist team by completing the form below, telephoning 0161 834 1515 (Manchester) or 020 3883 6790 (London) or email

James Claughton

James Claughton



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