The world of cryptocurrency has been experiencing significant developments in 2024, exemplified by the launch of Spot Bitcoin and Ethereum ETFs in the United States. This surge of interest in the crypto-sector is not limited to the U.S, as other countries, including the United Kingdom, are also stepping up their efforts to regulate this burgeoning industry. The latest headline-grabbing news from the U.K. is the introduction of the Property (Digital Assets etc) Bill in parliament.
Revising Definitions
As per an official statement,
For the first time in the history of British legislation, assets such as cryptocurrencies, non-fungible tokens (NFTs) like digital art, and carbon credits will be recognized as personal property under the law.
It is noteworthy that this bill has emerged shortly after the Law Commission’s preliminary discussion on cryptocurrencies, where the Commission recommended classifying crypto as property.
The bill expands the definition of “property,” previously confined to “things in possession” and “things in action,” to include a third category encompassing digital assets carrying personal rights.
Anticipated Impacts
The U.K. government anticipates that the passage of this bill will bring twofold advantages to its citizens. Firstly, it will provide much-needed clarity regarding the treatment of digital assets under English and Welsh law. Additionally, the legislation will offer legal protection to holders of digital assets in cases of fraud or scams.
According to Justice Heidi Alexander,
Ensuring that the law adapts to advancing technologies is crucial, and this bill will enable the crypto-assets sector to maintain its global standing and streamline intricate property-related matters.
Furthermore, the bill is expected to attract more investments into the U.K.’s legal services industry, currently valued at £34 billion annually.
The timing of this legislative proposal is significant, especially considering the trend of several nations proactively enacting crypto-friendly laws. It is evident that by introducing this bill, the British government aims to solidify the country’s position as a leader in the crypto sphere, particularly given the heightened focus on crypto in the U.S during an election year.
The actual impact of this bill, should it be approved, on the broader crypto sector remains to be seen.