The UK government has introduced a groundbreaking bill in Parliament that aims to clarify the legal status of digital assets such as cryptocurrencies, non-fungible tokens (NFTs) and tokenized real-world assets (RWAs).
Once passed, these assets will be formally recognised as personal property under UK law, providing enhanced legal protections for crypto holders and clearer guidelines for handling ownership disputes.
The bill is expected to provide significant protection to individuals and businesses affected by scams and fraud involving digital assets, and will also help resolve ownership disputes during legal proceedings, such as divorce, involving digital assets.
Justice Minister Heidi Alexander stressed that the proposal introduces a new category of property, alongside the existing legal classifications of “things owned,” which include physical items such as money and cars, and “things in action,” such as debts and stocks. The new category would specifically cover certain digital assets, allowing them to be considered personal property.
The development follows a consultation earlier this year by the Law Commission, an independent body responsible for reviewing the law in England and Wales. The commission recommended that certain digital assets, with a focus on cryptocurrencies, be labeled as property. “We conclude that some digital assets are things that have neither ownership nor action, yet the law of England and Wales treats them as things to which personal property rights may relate,” the commission said in its report.
*This is not investment advice.