UK plans to recover cryptocurrencies tied to bankruptcy cases

The Insolvency Service (IS) appointed former police investigator Andrew Small as its first dedicated crypto intelligence specialist to help recover digital assets for the UK economy from bankruptcy and criminal cases. Small will help track crypto assets lost in criminal cases and provide the agency with detailed knowledge of the crypto market.

The IS claimed that the number of insolvency cases involving crypto as a recoverable asset rose by 420% in the past five years, with 59 cases in 2024/25 compared to 14 in 2019/20. The estimated value of crypto assets identified in insolvency cases also skyrocketed 364x to more than £520K (~$710K) in 2024/25, from just a little over £1K in 2019/20. A 2024 study by the Financial Conduct Authority claimed that crypto assets had risen in popularity in recent years. It found that seven million adults in the UK, almost 12% of the population, held some form of crypto, up from 3.2 million adults (4.4%) in 2021.

Special agent Small said there was a rapid rise in crypto ownership in the UK and a similar rise in crypto assets lost in bankruptcy and criminal cases. His work will focus on helping the Insolvency Service trace, assess, and recover crypto holdings from individuals and companies subject to insolvency proceedings.

Small says crypto is very much a recoverable asset

The UK Insolvency Service has appointed former police investigator Andrew Small as its first dedicated #crypto intelligence specialist. He will be responsible for tracing and identifying digital assets in bankruptcy and criminal cases. The role, based within the agency’s…

— CryptOpus (@ImCryptOpus) June 9, 2025

Crypto specialist Small explained that the Insolvency Service had a duty to trace and recover money and assets from individuals or companies in insolvency cases and work to return as much money owed to creditors as possible. The Official Receiver Service, a key part of the Insolvency Service, identified £523,580 of crypto assets across 59 insolvency cases in 2024/25, compared to just £1,436 of crypto across 14 cases in 2019/20. 

Andrew’s new crypto asset intelligence role will be based within the Insolvency Service’s Investigation and Enforcement Services team, meaning he will primarily focus on crypto asset ownership in criminal cases. Neil Freebury, head of intelligence at the Insolvency Service, said Andrew brought a wealth of knowledge to this role and his previous experience as an economic crime investigator within the police. Freebury added that Andrew’s appointment would help IS investigators dealing with cases where crypto was a factor.

“Crypto is very much a recoverable asset, and my role will help the agency by providing specialist knowledge about the types of crypto assets available and the associated technology used to buy, sell, and store them.”

–Andrew Small, Crypto Intelligence Specialist at the Insolvency Services 

The IS was keen on Bitcoin, Ethereum, DOGE, Litecoin, and Non-fungible tokens (NFTs). However, Freebury pointed out that the number of insolvency cases involving crypto asset ownership rose four-fold in the past five years as crypto grew in popularity.

UK to collect specific crypto user and transaction data starting next year

The UK government will require crypto companies operating in the country to collect user and transaction information from 1 January 2026. The HM Revenue & Customs announced last week that the UK government’s data collection plan will follow the Organization for Economic Co-operation and Development (OECD) Crypto Asset Reporting Framework (CARF). The HMRC also said crypto firms may start collecting information earlier to be ready when the new rules come into force.

For individual users, the required data will include the user’s name, date of birth, home address, country of residence, National Insurance number or Unique Taxpayer Reference (for UK residents), and the tax identification number (TIN) along with the country where it was issued (for non-UK residents). For entity users, companies must collect the legal business name, main business address, registration number (for UK firms), and the TIN and issuing country (for non-UK firms). In some cases, platforms must also gather details of the company’s controlling persons.

Firms must also report sender and recipient names, addresses, tax IDs & full trade details (token type, quantity, GBP value, & timestamp). Failure to provide accurate, complete, or verified reports could result in penalties of up to £300 per user.

Cryptopolitan Academy: Tired of market swings? Learn how DeFi can help you build steady passive income. Register Now