UK Enacts Landmark Law Recognizing Cryptocurrencies and Stablecoins as Personal Property
In a significant move, the British authorities have passed a law that officially recognizes digital assets, including cryptocurrencies and stablecoins, as personal property, providing a clear legal status and protection for investors and consumers.
The new law, known as the Property (Digital Assets etc.) Bill, has received Royal Assent, marking the final step in the legislative process, as confirmed by Lord Speaker John McFall in the House of Lords. This development introduces a third category of ownership, alongside the existing ‘things in possession’ and ‘things in action’, which will provide legal protection for digital assets.
Key Provisions of the Law
The legislation clarifies that digital assets, such as Bitcoin and stablecoins like USDT, are considered personal property, giving them a solid legal basis that will make them easier to manage in courts and across financial systems. This move is expected to have significant implications for cases requiring proof of ownership, recovering stolen assets, and handling digital holdings in insolvency or probate proceedings.
According to digital asset advocacy group CryptoUK, the law will provide greater clarity and protection for consumers and investors, ensuring that digital assets are clearly owned, recoverable in the event of theft or fraud, and can be included in bankruptcy and probate proceedings. This development is seen as a significant shift toward giving everyday holders the same trust and security they expect from other forms of ownership.
International Context and Implications
The unique nature of cryptocurrencies has created many complications in litigation, which is why many jurisdictions are considering including this asset class in property law. For instance, Russia’s Justice Ministry has announced plans to classify crypto assets as property, while an Indian top court has ruled that cryptocurrencies are considered property under Indian law. The UK’s move is expected to strengthen the foundations for future innovation in the digital asset and tokenization landscape.
The Law Commission’s report, which recommended clearer recognition of digital assets in property law, has been instrumental in shaping this legislation. The report concluded that the flexibility of the common law allows for the recognition of a specific category of personal property that can better recognize, account for, and protect the unique characteristics of certain digital assets.
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