The Law Commission of England and Wales Has Described Cryptocurrencies As a New Kind of Property

The Law Commission of England and Wales has just shown its views that cryptocurrencies should be legally recognized as a new type of property. This would give crypto holders more security when it comes to their holdings, and could also pave the way for future regulation. They found that there is a “clear consensus” among participants that crypto should be treated as property, and this would provide benefits such as improved contract law and insolvency proceedings.

The Law Commission of England and Wales is considering extending property rules to cover crypto assets and non-fungible tokens (NFT). The commission, which is an independent body tasked with reviewing and updating the law, will now seek views on whether crypto assets should be treated as property under English law. Currently, crypto assets are not expressly recognized as property in England and Wales, which means that they are not subject to the same rules and regulations as other types of property. The current legal treatment of crypto assets may create uncertainty and risks for businesses and consumers.

The view of the commission would legally define digital assets as personal property, making it easier for crypto holders to take legal action in cases of fraud or theft. The bill would also require crypto exchanges to follow certain anti-money laundering and customer protection measures. These reforms could help to boost confidence in the crypto industry and attract more mainstream investors. In fact, some experts are concerned that the bill could impose too much regulation on the still-nascent crypto industry.

The commission also said that a lot of people are investing in cryptoassets without understanding the risks. The commission added that cryptoassets are a new type of property, and so they are not subject to the same regulations as other investments. This means that if things go wrong, investors may not be able to get their money back. The taskforce recommended that people only invest in cryptoassets if they are prepared to lose all of their money. They also advised that people should do their own research and seek professional financial advice before investing.

Now, a crypto-friendly proposal is aimed, in part, at helping England’s and Wales’s government’s goal of turning the country into a global crypto hub. The proposal would allow cryptoassets to be treated as a new property class, which would pave the way for their use in mainstream financial products and services. The move would also provide greater clarity and certainty for businesses operating in the crypto space, and potentially attract more investment into the UK.

The England and Wales commission has put forward proposals that, have implications for how crypto is taxed and regulated. However, the Scottish and Irish legal systems are not subject to these proposals. This means that crypto would not be treated as a new property in Scotland or Ireland because they have their own rules and regulations.

While this proposal is still in the early days, the commission’s proposal represents a significant step forward in bringing crypto into the mainstream. Only time will tell whether the proposal is successful, but it is clear that crypto is here to stay.