The UK government has recently taken a significant step towards strengthening its legal framework against the misuse of cryptocurrencies in criminal activities.
In a statutory instrument issued on February 29, it was announced that from the end of April, UK law enforcement will have the authority to freeze crypto assets tied to criminal acts without the necessity of a prior conviction.
This development is a part of the amendments to the Economic Crime and Corporate Transparency Act 2023, which grants the National Crime Agency expanded powers to confiscate and seize cryptocurrencies linked to illegal activities, bypassing lengthy legal processes.
The documentation further clarifies that this will enable the authorities to directly access cryptocurrencies held in exchanges and by custodian wallet providers.
An additional measure included in the amendment is the authority to eliminate crypto assets if deemed necessary.
Although the method for this was not specified, the common practice involves “burning” the crypto tokens by transferring them to a wallet from which they cannot be retrieved, effectively removing them from circulation.
This new law is scheduled to be enforced starting April 26.
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The legislation, reported by Cointelegraph in September 2022, is designed to enhance the capability of UK authorities in combating crypto-related crimes, including cybercrime, scams, and drug trafficking.
It includes a provision for the recovery of crypto assets linked to criminal activities without the prerequisite of an arrest, addressing the challenge of perpetrators evading conviction by staying abroad.
Despite these advancements, concerns have been raised by a British national, a victim of crypto fraud who lost around $46,000, about the UK’s preparedness in dealing with cryptocurrency crimes, criticizing the agency’s response to his case.
In addition to these measures, the UK government is planning to introduce new regulations on stablecoins and crypto staking within the next six months.
At a Coinbase-hosted crypto event in London on February 19, Economic Secretary to the Treasury Bim Afolami expressed the government’s commitment to finalizing these regulations before the next election, slated for no later than January 28, 2025.
Afolami emphasized the urgency of these regulatory efforts, stating, “We’re very clear that we want to get these things done as soon as possible. And I think over the next six months, those things are doable.”
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