The UK government is reportedly considering the sale of billions in Bitcoin (BTC) to bolster public finances. This move follows Bitcoin’s recent surge to a record high of $123,091.
UK Chancellor Seeks Crypto Revenue to Address Budget Deficit – Report
The Telegraph reports that the UK Home Office is investigating ways to liquidate at least £5 billion ($6.71 billion) in confiscated BTC, as the Labour-led government faces challenges in funding the public budget due to recent policy changes on welfare and winter fuel support by Prime Minister Kier Starmer.
According to the Telegraph, Chancellor of the Exchequer Rachel Reeves aims to address a £20 billion budget shortfall amid rising inflation, increased borrowing costs, and slow economic growth. While some ministers have suggested tax hikes as a solution, Reeves is considering alternative strategies, including selling crypto assets seized from illegal activities.
The exact volume of digital assets held by the UK government is unclear. However, a 2018 police operation seized 61,000 BTC from a Chinese Ponzi scheme. These assets, initially valued at just over £300 million ($402.36 million), now have a market value of £5.4 billion ($7.24 million), marking a 1700% increase.
UK to Introduce Crypto Custody Solution
To manage the BTC liquidation, the Telegraph notes that the UK Home Office is planning a crypto storage and realization system to help law enforcement securely store and sell seized digital currencies. This project is projected to cost £40 million ($53.65 million), with the service provider receiving additional commission on sales.
Interestingly, the UK government has previously opposed the idea of a National Bitcoin Reserve, as proposed by Nigel Farage, leader of the Reform UK party. However, these new plans might indicate a shift towards recognizing crypto assets as a valuable revenue source.
Typically, proceeds from confiscated assets are divided between the UK Treasury and law enforcement. It remains unclear what portion of the anticipated £5.4 billion BTC sale will contribute to balancing the UK’s financial books.
As of now, Bitcoin is trading at $117,856, reflecting a 0.07% increase over the past day.
