UK Lawmakers Approve Rules to Ease Seizure of Terror-Linked Crypto

With terror attacks tied to cryptocurrency projected to quadruple, the U.K. has approved new rules making it easier for law enforcement to seize crypto connected to terrorists.

As Coin Desk reported recently, the rules were proposed as amendments to the Economic Crime and Corporate Transparency bill.

“This addresses a gap in current counterterrorism legislation,” Tom Tugendhat, the minister of state responsible for crime and terrorism regulation, said last week.

He added that the counterterrorism legislation will “importantly mitigate the risk posed by those that cannot be prosecuted under the criminal system, but use their proceeds stored as crypto assets to perpetrate further criminality.”

Last month, PYMNTS reported that Svetlana Martynova, a senior legal officer on the United Nations counterterrorism committee, projected terrorist attacks linked to digital assets could quadruple from previously reported attacks.

Only a few years ago, just 5% of UN-analyzed terror attacks showed ties to crypto financing or trading, but “now we’re thinking that it may reach about 20%,” Martynova told Bloomberg News.

The UN is not taking this rise in crypto crime lightly, and it’s possible a UN Security Council resolution could be introduced to urge member states to deal with the risks connected to virtual assets and terrorism financing.

It’s happening as more people are using cryptocurrency for cross-border payments. According to the PYMNTS report, “Cryptocurrency, Blockchain and Cross-Border Payments: How Multinationals Leverage New Technology to Optimize Business Payments”, nearly 60% of cross-border businesses use at least one cryptocurrency, while 56% of cross-border businesses report using blockchain technology.

The U.K. vote came at the same time that officials in that country are dealing with an increase in the number of reported crypto asset scams, as PYMNTS reported last week.

A Freedom of Information (FOI) request by Capital Block showed that between July 2021 to June 2022, the Financial Conduct Authority received 7,287 reports of crypto asset scams, a 45% increase from the prior year.

“That the world’s financial centers do not yet have effective crypto regulation is quite shocking. Crypto is here to stay and it must be regulated consistently internationally and treated like any other financial investment, such as stocks and shares,” said Tim Mangnall, Capital Block’s CEO.

For all PYMNTS cryptocurrency coverage, subscribe to the daily Crypto Newsletter.