UK Considers Sale of Seized Bitcoins Worth $4 Billion
Date: 2024-07-22 Author: Henry Casey Categories: IN WORLD
A Bloomberg article reports that the UK Treasury is considering selling 61,000 BTC seized during investigations. A similar step was previously taken by the German authorities, which led to a significant decline in the cryptocurrency rate. The possible sale of Bitcoin could be a strategic move by the new UK Chancellor of the Exchequer, Rachel Reeves, to achieve several significant economic goals.
Rachel Reeves, the first woman to serve as UK Chancellor of the Exchequer, took up her post in early July 2024. In her first speech, she promised to restore the country's economy. According to Bloomberg, one of the possible tools for this could be bitcoins held in government wallets.
Sources of Crypto Assets
In March 2024, Arkham Intelligence experts discovered a wallet allegedly associated with the British government, which stored 61,245 BTC, which is equivalent to almost $4 billion at the current exchange rate. Most of these bitcoins were confiscated during an investigation into a fraudulent scheme in 2018, but authorities only gained access to the assets in 2021. One of the key defendants in the case is Chinese citizen Jian Wen, who was sentenced to almost seven years in prison.
Procedures and Legal Aspects
To sell these assets, it is necessary to legally prove that they were obtained illegally. This is an important step to legitimize the sale and use of the funds received for government purposes.
In her statements, Rachel Reeves repeatedly emphasized the difficult economic conditions that remain to be overcome. According to Bloomberg, she may follow the example of former British Prime Minister Gordon Brown, who sold 401 tons of gold from the country's reserves between 1999 and 2002, despite the recommendations of the Bank of England and financial analysts. This decision helped Brown achieve short-term economic success.
Risks and Opportunities of Selling Bitcoins
Selling bitcoins could bring significant financial resources to the UK budget and help improve the government's image. However, such a decision carries risks for the crypto market, especially given the recent example of Germany. In June 2024, German authorities sold 40,000 BTC in two weeks, causing the exchange rate to fall due to excessive selling pressure on the market.
Germany's experience demonstrates how large cryptocurrency sales can influence market prices. Over a short period, trading volumes on various exchanges increased significantly, which caused a short-term drop in the Bitcoin price.
Unobvious Consequences
Beyond the financial benefits, selling Bitcoin could have a positive impact on the UK government's image. According to Bloomberg, such a step could be perceived as support for the technology sector and a demonstration of a progressive approach to regulating cryptocurrencies.
As a result, the decision to sell confiscated bitcoins remains an important strategic step for Rachel Reeves and the entire UK economic policy. Time will tell how it will be implemented and what consequences it will have for the crypto market.
