Groundbreaking digital assets legislation brings certainty for English insolvency estates

On 2 December 2025, the Property (Digital Assets etc) Act 2025 became law, making England and Wales, and Northern Ireland, among the first countries in the world to confirm in law that digital assets – such as cryptocurrencies and non-fungible tokens – can now be recognised as personal property. 

A new "third" category of property

Following the Law Commission's recommendations, the Act creates a new third category of personal property, drafted broadly enough to capture digital assets including crypto-tokens and to accommodate further technological change.

What this means for insolvency estates

Digital assets like cryptocurrency can now clearly fall within the scope of the insolvency estate, bringing confidence and certainty to practitioners (and investors). Insolvency office-holders should  face fewer disputes and can use their full investigatory and claw-back powers to preserve and recover value in digital asset insolvencies.

The challenges ahead 

However, challenges remain for office-holders: price volatility makes valuation tricky; identifying and securing assets can be difficult; and because digital assets are borderless, they can be moved across jurisdictions quickly – potentially putting them beyond the reach of local enforcement orders.

Digital assets are also not treated as money or "foreign currency" in England and Wales, meaning claims to such assets will not found a statutory demand or be subject to conversion as at a particular date.  

What's next

The Act leaves it to the courts to develop this “third category” of personal property and it will be interesting to see how the courts develop the law to accommodate the unique features of these emerging assets, while ensuring that they can be protected as objects of property rights.

Find out more 

To discuss the issues raised in this article in more detail, please contact a member of our Restructuring and Insolvency team.