TLDR
- UK government is considering selling 5+ billion pounds worth of seized Bitcoin to help fill a 20 billion pound budget deficit
- The Home Office and Treasury are working with police to develop a secure system for storing and selling the cryptocurrency
- At least 61,000 Bitcoin worth $7.1 billion was seized in 2018 from a Chinese Ponzi scheme
- Legal challenges exist as Chinese authorities and Ponzi scheme victims are demanding the Bitcoin be returned
- Bitcoin Policy UK calls the sale reports “sensationalism” and says no sale can happen while legal processes are unresolved
The UK government is reportedly exploring the sale of over 5 billion British pounds worth of seized Bitcoin to help address a budget shortfall of up to 20 billion pounds. Chancellor Rachel Reeves is working with the Home Office and law enforcement agencies to potentially liquidate the government’s cryptocurrency holdings.
The Treasury and police are developing a secure storage system ahead of any planned sale. This comes as Bitcoin prices have rallied, increasing the value of government holdings seized through criminal investigations.
The bulk of the UK’s Bitcoin reserves stems from a 2018 raid that recovered 61,000 Bitcoin from a Chinese Ponzi scheme. At current prices of approximately $119,000 per Bitcoin, this holding is worth around $7.1 billion.
The seizure occurred when hospitality worker Jian Wen attempted to launder funds from an investment scheme operated by Tianjin Lantian Gerui Electronic Technology. Wen tried to purchase a mansion using Bitcoin but was later convicted on money laundering charges and sentenced to six years and eight months in prison in May 2024.
Legal Complications Emerge
The proposed Bitcoin sale faces legal challenges from multiple parties. Chinese authorities and victims of the original Ponzi scheme have been seeking the return of the cryptocurrency since 2024.
Susie Violet Ward, CEO of Bitcoin Policy UK, described media reports about the sale as “sensationalism over substance.” She stated that no sale can proceed while legal processes remain unresolved, as Chinese authorities and victims continue demanding the Bitcoin’s return.
No new info, no depth, just sensationalism over substance.
The Telegraph just dropped another lazy, clickbait Bitcoin article.
It tries to link the UK’s budget deficit to government crypto procurement and floats the idea of selling 61,250 bitcoin right in the middle of a bull… pic.twitter.com/lQ8NIHGbbw
— Decentra Suze (@DecentraSuze) July 20, 2025
A group representing the Ponzi scheme victims contacted China’s Foreign Affairs Ministry in April 2024, requesting negotiations with the UK to recover the Bitcoin. The victims originally lost Chinese yuan rather than Bitcoin directly.
Government Storage Challenges
The Crown Prosecution Service has asked the High Court for permission to retain the seized Bitcoin. Under proceeds of crime laws, any sale would need to satisfy confiscation orders and potentially compensate victims if ordered by a court.
After covering costs and victim compensation, remaining funds would go to the Treasury and law enforcement agencies involved in asset recovery. The government attempted to establish a 40 million pound “crypto storage and realisation framework” in May to help police manage seized cryptocurrency.
This tender process was terminated earlier this month after the government received no bids that could meet their requirements. The storage challenges highlight the technical complexities of managing large cryptocurrency holdings.
Bitcoin Policy UK previously urged the government in July 2024 to amend laws giving more discretion to retain valuable digital assets. This recommendation was reportedly ignored by officials.
Jordan Walker from Bitcoin Collective wrote an open letter opposing any Bitcoin sale, arguing it would send concerning signals about the UK’s economic positioning. The total amount of Bitcoin held by the UK government beyond the 2018 seizure remains unknown.
Police currently handle cryptocurrency sales in the UK, but Treasury involvement has increased as crypto market values have risen during the recent rally.
