The UK is reportedly eyeing the sale of over 5 billion British pounds ($6.7 billion) worth of seized Bitcoin to help fill a deficit in the countryโs budget.
The Home Office and the head of the countryโs Treasury, Rachel Reeves, are working with law enforcement to sell off its stockpile of seized Bitcoin (BTC) and plans to make a system to store the crypto to handle the sell-off, The Telegraph reported on Saturday.
Police handle crypto sales in the UK, but the Treasury is reportedly involved as the crypto market has rallied, boosting the value of the governmentโs holdings.ย
The total amount of seized Bitcoin the country is holding is not known, but it contains at least 61,000 Bitcoin, currently worth around $7.1 billion, seized from a Chinese Ponzi scheme in 2018 that was being held in the UK.
The idea of the UK selling its Bitcoin was floated earlier this year, with The Daily Mail and The Times reporting in January that Reeves could sell the Bitcoin stash to plug the countryโs budget.
Cointelegraph contacted HM Treasury for comment.
Ponzi victims want UK to hand Bitcoin back
However, the UKโs plans to sell the Bitcoin could be hung up by the victims of a Chinese Ponzi scheme, who have been seeking the return of the Bitcoin since 2024.ย
โThe UK’s bitcoin is still legally contested,โ Susie Violet Ward, the CEO of the crypto lobby group Bitcoin Policy UK, said in a post on X on Sunday, slamming the report as โsensationalism over substance.โ
โChinese authorities and victims are demanding it back. No sale can happen while that legal process is unresolved,โ she added.
The UK seized the Bitcoin in 2018 after hospitality worker Jian Wen attempted to launder funds of an investment scheme conducted by Tianjin Lantian Gerui Electronic Technology by trying to buy a mansion with BTC.
Wen was later charged with three counts of money laundering, which she denied, but was found guilty in March last year and jailed for six years and eight months in May 2024.ย
A group representing the Ponzi schemeโs victims asked Chinaโs Foreign Affairs Ministry in April 2024 to negotiate with the UK to recover the Bitcoin.ย
UK wants to keep seized Bitcoin
Meanwhile, the Crown Prosecution Service has asked the High Court to let it keep the Bitcoin seized from the scheme, which could see the funds sold and split between law enforcement agencies.
Freddie New, Bitcoin Policy UKโs head of policy, posted on X on Sunday that any sale of the crypto would happen under proceeds of crime laws, which set out that assets will be sold โto satisfy confiscation ordersโ and compensate victims if ordered by a court.
โWe understand that the victims here lost yuan, NOT Bitcoin. Thereโs an extra wrinkle here in that we also understand there may be diplomatic efforts underway to ask for the Bitcoin rather than the yuan which was originally lost,โ he added.
New said that after costs and victim paybacks, the remaining funds would go to the Treasury could be split between โthose bodies involved in the asset recovery,โ such as the police.
Related: UK elections: How crypto donation risks are dividing MPs
In May, the UK put out to tender a 40 million British pound ($53.7 million) โcrypto storage and realisation frameworkโ to allow police to store and manage seized crypto. It was terminated earlier this month after the government said it hadnโt received bids that could fulfill the demand.
UK again urged to stockpile Bitcoin
New said Bitcoin Policy UK wrote to the government in July 2024, urging it to amend the law โto give themselves more discretion to retain this valuable asset,โ which he said was ignored.
Jordan Walker, the founder of the crypto advocacy group Bitcoin Collective, wrote an open letter to the government urging it not to sell the Bitcoin in light of The Telegraphโs report.
โSelling these holdings to address a short-term budget deficit would send a concerning signal,โ he said, adding it could have โlong-term consequences for the UKโs economic positioning.โ
AI Eye: UKโs Orwellian AI murder prediction system, AI will take your job
