Confiscating crypto assets - state responses and challenges
There is little doubt that criminals (and to a lesser extent, terrorists) are increasingly turning to cryptocurrencies to launder their funds, receive ransom payments, store their profits, and generally hide their financial trail. Cryptocurrencies are like any other asset (including cash) and can be seized as part of a criminal investigation. But seizing crypto assets requires a different skillset than other, more physical, asset seizures. To date, only a handful of states have seized crypto assets, but more are expected to develop this capability. Over time, states are likely to seize and hold assets worth billions of dollars — these assets are both more liquid than other types of seized assets, and present unique challenges in terms of storage and management.
Updated 6 April 2022
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Seizing criminal assets is an important part of deterring and disrupting criminal activity, as is restoring stolen funds and assets to the victims of crime. The digital nature of cryptocurrency assets are such that there are a few important components to seizure that differ from traditional assets: controlling the wallet, a password, and speed.
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