Section 303Z55: Frozen crypto wallet: conversion, Proceeds of Crime Act 2002

This section applies while a crypto wallet freezing order under section 303Z37 has effect (including where cryptoassets held in a crypto wallet that is subject to a crypto wallet freezing order are subject to forfeiture proceedings).

A person within subsection (3) may apply to the relevant court for an order requiring all of the cryptoassets held in the crypto wallet to be converted into money.

The following persons are within this subsection—

an enforcement officer;

a person by or for whom the crypto wallet is administered.

In deciding whether to make an order under this section, the court must have regard to whether the cryptoassets (as a whole) are likely to suffer a significant loss in value during the period before—

the crypto wallet freezing order ceases to have effect, or

the cryptoassets are forfeited (including the period during which an appeal against an order for forfeiture may be made).

Before making an order under this section the court must give an opportunity to be heard to—

the parties to the proceedings, and

any other person who may be affected by its decision.

As soon as practicable after an order is made under this section, the UK-connected cryptoasset service provider that administers the crypto wallet must convert the cryptoassets, or arrange for the cryptoassets to be converted, into money.

The conversion of cryptoassets under subsection (6) must be carried out, so far as practicable, in the manner best calculated to maximise the amount of money obtained for the cryptoassets.

At the first opportunity after the cryptoassets are converted, the UK-connected cryptoasset service provider must arrange for the amount of money obtained for the cryptoassets to be paid into an interest-bearing account nominated by an enforcement officer and held there.

But—

the UK-connected cryptoasset service provider may deduct any reasonable expenses incurred by the provider in connection with the conversion of the cryptoassets, and

the amount to be treated as the proceeds of the conversion of the cryptoassets is to be reduced accordingly.

Interest accruing on the amount obtained for the cryptoassets is to be added to it on its forfeiture or release.

Where cryptoassets are converted in accordance with an order made under this section—

the crypto wallet freezing order ceases to have effect,

any application made under section 303Z41(2) in relation to the cryptoassets which has not yet been determined or otherwise disposed of (including under section 303Z44 or 303Z45) is to be treated as if it were an application made under section 303Z60(2) in relation to the converted cryptoassets, and

any application made under section 303Z46(2) in relation to the crypto wallet which has not yet been determined or otherwise disposed of may not be proceeded with.

An order made under this section must provide for notice to be given to persons affected by the order.

No appeal may be made against an order made under this section.

Section 303Z55: Frozen crypto wallet: conversion

Discussed in

About this text