UK Formally Recognises Crypto as Property Under New Digital Assets Act

The UK has enacted the Property (Digital Assets etc.) Act 2025, formally recognising crypto assets as a new category of property. The legislation introduces a third type of personal property — digital assets, a class that includes cryptocurrencies, NFTs, and other tokenised digital items. The Act clarifies that digital items can qualify for property rights even if they do not fall under traditional legal categories such as “things in possession” or “things in action.” This gives courts a clear framework for handling disputes involving crypto assets, something previously determined only through individual cases. The law took effect on December 2 and applies to England, Wales, and Northern Ireland, with the goal of modernising property legislation for the digital economy. Industry association CryptoUK called the Act “an important step” that enhances user confidence and strengthens the legal foundation of digital assets in the country. Its experts added that the UK has a genuine opportunity to set a global benchmark for crypto and stablecoin regulation, but warned that policymakers will need deeper engagement with industry participants to achieve this. Key Impacts of the Digital Asset Property Category litigation becomes easier in cases of fraud, lost access, and ownership disputes; crypto assets gain a clear legal basis for inheritance procedures; exchanges, custodians, and institutions receive stronger legal backing; the UK positions itself competitively amid accelerating regulation in the US and EU. The new law is part of a wider transformation of the UK’s digital asset strategy. In September, the Financial Conduct Authority (FCA) said it would allow crypto firms certain exemptions from traditional financial rules, acknowledging that existing frameworks do not fully fit digital assets. At the same time, the regulator plans to strengthen cyber-resilience standards following the high-profile Bybit incident. Later, the UK and the US announced a joint working group on digital asset regulation, expected to publish recommendations by March 2026. In October, the government introduced the role of Digital Markets Champion, tasked with advancing blockchain integration in financial infrastructure, tokenising government bonds, and modernising wholesale markets. In November, the Bank of England revealed that upcoming stablecoin rules may include holding limits: £20,000 for individuals and £10 million for businesses — signalling a more structured approach to digital asset oversight.