The UK government is planning to seize Bitcoin it recovered in a scam that happened in 2018. This move comes in the wake of the scammer who organised the fraud being convicted at courts.
Following the conviction of Zhimin Qian on accounts of possessing and transferring criminal property, the British government is seeking to gulp up the $7 billion worth of Bitcoin it confiscated during a fraud related to a Chinese investment firm.
With more than 120,000 victims seeking compensation, and the UK government possessing 61,000 BTC, the big question is who will get to keep the money. Although the process to compensate the victims could be cumbersome, experts state that the victims hold the right to be compensated, upon providing a link to seized BTC.
Although a crypto netizen stated that the government will pocket the money, however, Ashley Fairbrother, a partner at Edmonds Marshall McMahon, speaking to a prominent crypto media stated “I am not sure that English Law is on the U.K. government’s side here on whether it can keep the seized Bitcoin”
While explaining the numerous ways that victims could claim their seized property, Fairbrother, stated that the High Court may ultimately choose what’s in best interest with the UK government.
To speculate on how the UK might go about this compensation, Fairbrother cited the case of Robb v The National Crime Agency. During this compensation, “the victim’s shares were to be calculated by establishing their individual payments as a percentage of the total investors’ payments and applying that same percentage to the fund”
But the glitch in the above approach is that the victims were compensated based on the fiat currency amount they lost rather than in BTC. However, with this approach, the UK State will benefit from the substantial increase in the value of BTC.
For instance, say a person lost 10 BTC to the scam. In 2018, the price of BTC was $7.5K, and so the total amount lost was $75, 000. So the government will be eligible to pay $75,000 rather than 10 BTC. This means that with the current price of BTC over $115K, 10 BTC will be worth more than $1 million. So, imagine paying $75,000 instead of a million and pocketing the rest.
