The UK is reportedly preparing to sell more than £5 billion (around $6.7 billion) worth of seized Bitcoin in an effort to address a budget shortfall.
According to The Telegraph, the Home Office and Chancellor Rachel Reeves are coordinating with law enforcement to liquidate a significant portion of the government’s Bitcoin holdings. Plans are also underway to establish a system for securely storing and managing the digital assets ahead of the sell-off.
The move comes amid a strong rally in the cryptocurrency market, which has significantly increased the value of the UK’s seized crypto assets. While police typically oversee crypto liquidations, the Treasury is now involved due to the growing size and value of the holdings.
Although the full extent of the UK’s seized Bitcoin is unclear, it includes at least 61,000 BTC—currently valued at roughly $7.1 billion—that were confiscated in connection with a 2018 Chinese Ponzi scheme and are being held in the UK.
The idea of selling the seized Bitcoin has been discussed since early 2025, with The Daily Mail and The Times reporting in January that Reeves was considering the sale as a way to help balance the budget.
Ponzi victims want UK to hand Bitcoin back
However, the UK’s plan to sell the seized Bitcoin may face delays due to ongoing legal claims from victims of a Chinese Ponzi scheme, who have been seeking the return of the assets since 2024.
“The UK’s Bitcoin is still legally contested,” said Susie Violet Ward, CEO of the crypto advocacy group Bitcoin Policy UK, in a post on X on Sunday. She criticized the recent report as “sensationalism over substance.”
“Chinese authorities and victims are demanding its return. No sale can take place until the legal process is resolved,” she added.
The UK seized the Bitcoin in 2018 after hospitality worker Jian Wen attempted to launder funds linked to an investment scam run by Tianjin Lantian Gerui Electronic Technology. Wen tried to purchase a mansion using Bitcoin, which led authorities to uncover the scheme.
She was later charged with three counts of money laundering. Although she denied the charges, Wen was found guilty in March 2024 and sentenced to six years and eight months in prison that May.
In April 2024, a group representing victims of the Ponzi scheme appealed to China’s Foreign Affairs Ministry to engage in negotiations with the UK to recover the seized Bitcoin.
UK aims to retain seized Bitcoin
Meanwhile, the Crown Prosecution Service has requested permission from the High Court to retain the Bitcoin seized from the Ponzi scheme—potentially allowing the assets to be sold and proceeds shared among law enforcement agencies.
Freddie New, head of policy at Bitcoin Policy UK, noted in a post on X that any sale would be governed by proceeds of crime laws, which stipulate that confiscated assets can be sold to satisfy court-ordered confiscation or to compensate victims if ordered by the court.
“We understand the victims originally lost yuan, not Bitcoin,” New wrote. “There’s an added complexity here, as we believe diplomatic discussions may be underway to request the return of Bitcoin rather than the yuan that was actually lost.”
New also explained that after covering legal costs and any victim compensation, the remaining funds would go to the UK Treasury, with a portion possibly allocated to agencies involved in the asset recovery process, such as the police.
In a related development, the UK government issued a £40 million ($53.7 million) tender in May to establish a “crypto storage and realisation framework” that would allow police to securely store and manage seized digital assets. However, the initiative was terminated earlier this month after no suitable bids were received.
UK once again urged to hold onto Bitcoin reserves
Freddie New said that Bitcoin Policy UK sent a letter to the government in July 2024, calling for legal changes that would give authorities greater discretion to retain the seized Bitcoin. However, the proposal was reportedly ignored.
In response to The Telegraph’s report, Jordan Walker, founder of the crypto advocacy group Bitcoin Collective, also urged the government not to sell the holdings. In an open letter, he warned that doing so to cover a short-term budget gap “would send a concerning signal” and could carry “long-term consequences for the UK’s economic positioning.”
