LONDON, UK – British officials are reportedly wary of relying on a substantial cache of 61,000 bitcoins (BTC), seized from Chinese fraudsters in 2018, to help address the nation's budget shortfalls. While the UK Treasury has considered retaining most of these digital assets, legal warnings highlight the high probability of a protracted court battle over their ownership.
The Financial Times reported that the UK Treasury BTC cache, now valued significantly higher than at the time of seizure, has sparked discussions about its potential to bolster the country's finances. However, other officials have reportedly cautioned Chancellor of the Exchequer Rachel Reeves against factoring the cryptocurrency seized into budget calculations. The primary concern revolves around the expected length and complexity of the legal challenges ahead.
The Metropolitan Police recently confirmed that the UK Bitcoin seizure originated from a vast investment fraud scheme. Over 128,000 victims were affected, with funds traced back to Zhimin Qian and her Malaysian assistant, Seng Hok Ling. Many of these victims are Chinese nationals now actively seeking the return of their stolen money. Chinese law enforcement played a crucial role in building the case against Qian, who pleaded guilty to charges of acquiring and possessing criminal property. Their cooperation sets an expectation for the seized bitcoins to be used for victim reimbursement.
Attorneys from the firm Fieldfisher, as cited by the Financial Times, indicated that some victims are pursuing not only the return of their initial investment but also a premium. This premium would compensate for the nearly decade-long period during which they were denied access to their funds. "The victims have been deprived of their assets for around 10 years now and are entitled to recover from the bitcoin frozen in this jurisdiction," the lawyers stated.
The civil recovery case is tentatively scheduled for a hearing in early 2026, though a potential appeal could push the final resolution well into 2027. This prolonged timeline further complicates any plans the UK Treasury might have for the assets. Additionally, some experts have warned that liquidating such a significant amount of Bitcoin could potentially trigger a notable decline in its market price, adding another layer of risk to any hasty disposal. The ongoing legal complexities make counting on the seized cryptocurrency for the UK fiscal deficit a precarious proposition.
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