Property (Digital Assets etc) Act 2025 Explained: What it Means for Crypto and Digital Assets

Property (Digital Assets etc) Act 2025 becomes law

The Property (Digital Assets etc) Act 2025 is now law, bringing clarity to how emerging assets, such as crypto-tokens, are treated in England, Wales, and Northern Ireland. This development is significant for businesses, investors, and individuals who hold or deal with digital assets.

Why was this act introduced?

As stated in the preamble, the act is:

‘…to make provision about the types of things that are not prevented from being objects of personal property rights’.

Recognition that certain digital assets, such as crypto-tokens, are not being prevented from being objects of personal property rights is relevant in various contexts. These include:

• theft and fraud;
• collateral arrangements as security for loans;
• trusts;
• the payment of creditors in bankruptcy and insolvency cases; and
• succession on death.

The bill received Royal Assent on 2 December 2025 and became law the same day.

Commissioner for Commercial & Common Law, Professor Solène Rowan, remarked:

‘The passage of the Property (Digital Assets etc) Act 2025 keeps the law of England and Wales at the forefront of legal development. This new Act, which is based on our recommendations, will enable the courts to develop the law in ways that accommodate the unique features of these emerging assets, while ensuring that they can be protected as objects of property rights…’.  

Read the Law Commission press release (3 December) here.

What does the act say?

The act is short. There is one main clause, with section 2 covering territorial extent, commencement and short title.

Section 1 is repeated below:

Objects of personal property rights

A thing (including a thing that is digital or electronic in nature) is not prevented from being the object of personal property rights merely because it is neither—

1. a thing in possession, nor
2. a thing in action.

The act removes this uncertainty by confirming that digital assets can attract personal property rights.

Why is this important?

The courts had already shown flexibility in regard to digital assets like crypto-tokens attracting property rights. For example, in a 2019 High Court case, it was established that cryptoassets, such as Bitcoin, are a form of property under English law. Mr Justice Bryan (at [58]):

‘.…I consider that it is fallacious to proceed on the basis that the English law of property recognises no forms of property other than choses in possession and choses in action’. 

AA v Persons Unknown & Ors, Re Bitcoin [2019] EWHC 3556 (Comm) (13 December 2019)

In a factsheet about the bill, the Ministry of Justice (MoJ) explained that, nevertheless:

‘There remains lingering uncertainty caused by comments in old case law that said the two categories of personal property are exhaustive, and that there can be no “third category”’.

Read the MoJ factsheet here.

The Law Commission for England and Wales was asked to consider the issue of digital assets. The act gives effect to recommendations of the Law Commission.

Flexibility and future development

During the bill’s passage through parliament, there were suggested amendments requiring the government to publish guidance on what to consider for digital things to attract personal property rights. These amendments were rejected.

By way of example, during a debate of the bill in the House of Lords, Lord Ponsonby of Shulbrede stated:

‘The Bill deliberately does not try to define the types of assets that may fall within its scope. Rather, it unblocks the common law and leaves it to the courts to develop the appropriate principles, building on centuries of world-renowned common-law development. By doing this, English and Welsh and Northern Ireland law can remain dynamic, globally competitive and a useful tool for those in the digital asset market’. Lords Hansard for 30 April 2025 (Volume 845)

What benefits does the act bring?

With uncertainty removed about whether digital assets attract personal property rights, this strengthens the pull of England and Wales and Northern Ireland as jurisdictions:

• to deal with digital assets, and
• to litigate related issues.

The act is one of the first to formally recognise digital assets in this way.

What does this mean for businesses and individuals?

If you hold or deal with digital assets, this change could affect you.

With the act confirming the existence of a ‘third category’ of personal property rights, digital assets (such as crypto-tokens) can be used as security for loans and to pay creditors in insolvency situations. They can also be placed in a trust, inherited, and there are rights and remedies if they are stolen.

How we can help

In the words of the Minister for Courts and Legal Services, Sarah Sackman KC MP:

‘This new law will keep Britain at the heart of the international legal industry. By clarifying the status of digital assets, we remove uncertainty, simplify disputes, and cement the UK’s position as the centre for fintech innovation’.

Read the related MoJ press release (4 December) here.

Our experienced team of technology solicitors can guide you through the implications of the Property (Digital Assets etc) Act 2025 and help you manage risks and opportunities in this evolving area.