Digital assets and cryptoassets

What are digital assets?

Digital assets are not currently defined in English law, but they include things like social media accounts (such as Facebook, Instagram, TikTok or Twitter), photographs stored in the cloud and on a computer, cryptocurrency (such as Bitcoin), digital music libraries (iTunes), loyalty points, gaming accounts and characters, bank accounts, medical records and non fungible tokens.

Digital assets are increasing in value, and this is only likely to continue over future years with the introduction of decentralised finance being considered by the Bank of England. In 2022 they were estimated to be worth £25 billion in the UK. HMRC has recognised the value of the sector and now has an extensive Cryptoassets Manual, which recognises crypto tokens as property and liable to taxation. UK Cryptoasset businesses have been required to register with the Financial Conduct Authority to prevent them being used for money laundering since 10 January 2021.

The US and Canada have introduced legislation to allow fiduciaries access to digital assets, which helpfully define these, which may be indicative.

On 28 June 2023, the Law Commission published itsfinal report following its consultation

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Private Client weekly highlights—21 November 2024

This week’s edition of Private Client highlights includes: (1) Wigglesworth v Beetson, in which the claimant failed in an action for estoppel and adverse possession; (2) the Hansard Society to host a briefing on parliamentary process for Assisted Dying Bill; (3) Khan v Khan, which considered family property and constructive trusts; (4) analysis of the Autumn Budget announcement to bring unused pension funds and death benefits within the scope of IHT; (5) Palmer v Sans, which found that there was no transaction at an undervalue where property was already held on trust for the transferee; (6) KA v FA (The Secretary of State for the Home Department intervening), where the court recognised an overseas adoption notwithstanding failure of common law test; and (7) Kireeva v Bedzhamov, in which the Supreme Court has confirmed the application of the immovables rule to English property.

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Private Client analysis: In a decision which will come as a relief to private individuals who own shares in BVI companies, the Privy Council has decided that section 245 of the BVI’s Business Companies Act 2004 does not have the effect of re-categorising shares as immovable property for the purposes of succession. Written by Kyle Bonnell, pupil at XXIV Old Buildings.

Supreme Court confirms application of immovables rule to English property

The Supreme Court has unanimously dismissed Ms Kireeva’s (Russian bankruptcy trustee’s) appeal to overturn the Court of Appeal’s’ decision regarding matters arising out of the bankruptcy of Mr Bedzhamov. Peter Declercq and Patrick Elliot, partners at DCQ Legal (who acted for Ms Kireeva), discuss the implications of the judgment.

UT finds FTT made errors when setting aside HMRC best judgment assessment (HMRC v Sintra Global)

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