New UK law establishes the legal status of digital assets

Key points:

• The UK Parliament has passed a law that officially recognizes cryptocurrencies and stablecoins as a form of property.
• The new document removes legal uncertainty and gives owners of digital assets full property protection.

The UK Parliament has approved a law that officially recognizes cryptocurrencies and stablecoins as a form of property. The Digital Assets Bill received royal assent after being announced in the House of Lords by John McFall.

Now, with the approval of King Charles III, digital assets are protected by property rights. They are no longer in a “gray area” where their status was determined by individual court decisions.

Previously, digital tokens were sometimes considered property, but this was not clearly enshrined in law. The new document follows the recommendations of the Law Commission of England and Wales, which in 2024 proposed recognizing cryptocurrencies as a separate type of movable property. This should eliminate disputes arising from the ambiguity of the status of digital assets.

The law will strengthen the rights of crypto owners

Under British law, movable property is divided into two groups: physical objects (“things in possession”) and contractual rights (“things in action”). Lawyers have noted that cryptocurrency does not fit into either of these categories. The new law solves this problem. It confirms that digital objects can also be considered personal property, even if they do not fit the old definitions.

CryptoUK added that the updated legal framework will simplify the handling of cases involving theft of funds, inheritance of digital assets, and bankruptcy of companies associated with cryptocurrencies. Courts will now be able to confirm ownership and return tokens more quickly after fraud.

The government sees this law as part of its strategy to turn the UK into a digital finance hub. According to the financial regulator, about 12% of the country’s adult population already owns cryptocurrency, and this share continues to grow.

Earlier, it was reported that the authorities are discussing a possible ban on cryptocurrency donations to political parties — a measure that could affect Reform UK, which recently began accepting digital assets.