- U.K. officials have frozen $7.7 million in crypto since April 2024 to combat financial crime. U.K. Police are now able to freeze wallets without an arrest if money appears illegal.
- A Newcastle court froze $1.94 million in a Coinbase wallet on March 18 at HMRC’s request, perhaps due to tax reasons. The owner is still unknown.
- Additional freeze orders are anticipated, but obstacles such as foreign ownership, private wallets, and few crypto experts persist.
U.K. officials have moved to freeze crypto assets associated with criminal activities. They have frozen around $7.7 million in digital assets since April 2024. This is part of new powers bestowed on the National Crime Agency (NCA) and the police to combat illegal operations using cryptocurrencies.
The powers enable law enforcement to freeze and seize crypto wallets for a period of up to three years. They can, in some instances, destroy the assets if they think it is not well for the public to bring them back to the market.
Largest freeze order on Coinbase wallet
One of the largest freeze orders was placed on a wallet on Coinbase with approximately $1.94 million in crypto. The order was made by a Newcastle Upon Tyne court on March 18.
It was sought by His Majesty’s Revenue and Customs (HMRC), which could indicate that the case is related to tax issues. The wallet owner, however, has not been named.
U.K. Authorities don’t require an arrest to freeze a wallet. They can act if they believe the money is illegal in origin or intended for criminal use. This allows them to prevent criminals from transferring money before an investigation is over.
Legal experts indicate that this procedure allows officials to obtain more information before making final conclusions in a case.
Future of crypto freezing orders
Certain attorneys opine that additional crypto freeze orders will be made in the future. They argue that the U.K. government is making more efforts towards preventing illicit financial transactions involving cryptocurrencies.
It is now possible for investigators to freeze wallets without owners being notified beforehand. This keeps individuals from transferring their funds ahead of any action. Those subject to a freeze order have to answer official queries, which might aid in existing investigations.
Yet, the enforcement of these regulations remains problematic. Foreign nationals comprise most of the subjects, so it is hard for the authorities to be prompt. Then, crypto held on centralized exchanges such as Coinbase or Binance can be frozen only.
Private wallets, which need personal keys, are inaccessible to law enforcement. Yet another problem is that most investigators do not understand cryptocurrencies properly, so it is delayed.
Experts point out that crypto is still a small part of illegal financial activities compared to traditional methods like bank fraud. However, with time, authorities are expected to improve their ability to track and freeze digital assets.
The recent actions in the U.K. show that governments are becoming more serious about controlling the misuse of cryptocurrencies.
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