UK Chancellor Plans £5 Billion Bitcoin Sale

According to the Telegraph, British Chancellor of the Exchequer Rachel Reeves plans to sell £5 billion worth of seized Bitcoin assets to address a significant public finance gap.

The Ministry of Internal Affairs, along with police forces, has initiated efforts to establish an official system for selling this substantial stock of cryptocurrency.

The total value of cryptocurrencies seized by police remains unknown; however, in 2018 alone, 61,000 Bitcoins from a China-based pyramid scheme were confiscated. At that time, these assets were valued at approximately £270 million. With Bitcoin reaching $123,000 (around £92,000) last week, their current worth exceeds £5.4 billion.

The government intends to develop a “crypto custody and sales framework” for the secure storage and sale of these digital assets. While it remains unclear how much of the sales proceeds will go to the treasury, typically, proceeds from crime are shared between the central government and law enforcement. When victims are unidentified, the treasury often receives a larger share.

Economists anticipate that the government will require up to £20 billion in funding this autumn, as high inflation and interest rates are increasing borrowing costs, and sluggish economic growth is impacting revenue. The Treasury is reportedly exploring alternative revenue sources, including tax increases.

Moreover, the positive regulatory moves by the Donald Trump administration towards cryptocurrencies in the US and the enactment of the “Genius Act”, the first national cryptocurrency law, have fueled a significant rise in Bitcoin prices. Such developments are expected to encourage similar strategies in the UK. In the US, the Trump administration seeks to develop a national reserve using $3.4 billion of confiscated Bitcoin.

In the UK, Reform UK leader Nigel Farage supports the creation of a national Bitcoin reserve; however, the Labour Party has dismissed this proposal due to the cryptocurrency’s inherent volatility.

This is not investment advice.