New Legislation Establishes Digital Assets as a Distinct Property Type
On December 2, 2025, the UK officially recognized cryptocurrencies and digital assets as a separate type of personal property with the new Property (Digital Assets etc) Act 2025. Lord Speaker John McFall announced new legislation in the House of Lords.
This law adds a third type of property in English and Welsh law, in addition to physical objects and contractual rights. The new classification includes cryptocurrencies, NFTs, and carbon credits. The act is the result of suggestions from the Law Commission of England and Wales.
Legislative Journey and Royal Assent
The Law Commission released their final report in June 2023 after extensive consultations. The legislative process commenced when the bill successfully passed through the House of Lords in May 2025. It subsequently underwent its third reading in the House of Commons in November and ultimately received royal assent from King Charles.
Impact on Digital Asset Recovery and Legal Frameworks
This new legal framework significantly impacts how digital assets can be recovered and how disputes are resolved. Courts can now apply existing property laws to digital assets, which empowers owners to better understand their rights when seeking to reclaim stolen cryptocurrencies resulting from hacks or fraud.
Judges are now equipped to issue orders for asset freezing and tracing across different wallets. Furthermore, insolvency practitioners can incorporate digital assets into bankruptcy proceedings, and executors can treat cryptocurrencies as inheritable property within wills.