According to The Telegraph, the UK Prime Minister of Exchequer Rachel Reeves will close the big financial gap by selling seized Bitcoin assets worth £5 billion.
The Ministry of Home Affairs, together with the police, has begun work to establish an official system for selling this large cryptocurrency stock.
The total value of the cryptocurrency seized by the police is unknown, but in 2018 alone, 61,000 bitcoins belonging to the China-based pyramid scheme were seized. At the time, the assets were worth around £270 million, but Bitcoin reached $123,000 last week (about £92,000), so it is now worth over £5.4 billion.
The government plans to develop a “crypto custody and sales framework” to securely store and sell these digital assets. It is not yet clear how much of the proceeds from the sale will be transferred to the Ministry of Finance, but proceeds from crime are usually shared between the central government and law enforcement agencies. The Treasury is known to receive a larger share if the victim remains unidentified.
Economists say the government will need to raise up to £20 billion this fall. High inflation and interest rates increase borrowing costs, while weak economic growth is weighing revenue. The Treasury is reportedly considering alternative revenue streams, including tax increases.
In particular, the positive measures taken by the Donald Trump administration on US cryptocurrencies and the “genius law” passing the first National Cryptocurrency Act, have led to a significant rise in Bitcoin prices. These developments are expected to stimulate similar strategies in the UK. In the US, the Trump administration aims to establish a national reserve using the $3.4 billion forfeited Bitcoin.
In the UK, British reform leader Nigel Farage advocates for the UK to establish a national Bitcoin Reserve, but Labour has rejected the proposal because of the high volatility of cryptocurrency.
*This is not investment advice.
