The European Union favours the confiscation of unspecified crypto-assets. The EU Council has already approved new rules to regulate digital currencies.
They include the freezing and confiscation of unidentifiable digital assets. In the view of the Council of the EU, the existing confiscation system should be modernised. This is stated in the "Proposal for an EU Parliament and Council Directive on Asset Recovery and Confiscation".
This decree is intended to establish rules for the surveillance, recognition, freezing, seizure and management of property in criminal proceedings. It will also enhance the ability of relevant organisations to seize any illegally acquired income from those who have broken the law. The directive states that any type of property, including digital assets, can be confiscated or frozen if it is proven to have been obtained illegally or its owner is involved in criminal activity.
Persons who own "unrecognised" property will be required to prove that the value of their property is not inconsistent with their real income. In deciding whether the property in question was obtained illegally, the national courts will consider all relevant information in the case, including evidence and facts such as whether the value of the property is significantly disproportionate to the legitimate income of the owner.
Another factor to be taken into account is the lack of probable legal origin of the asset. Once the law is adopted by all EU member states, a three-year transition period will begin for its full legal implementation.
This year, the European Union decided on new AML rules and gave the go-ahead for a piece of legislation known as Markets in Crypto Assets (MiCA). It will come into force in 2025.
To regulate the DeFi sector, ECB chief Christine Lagarde is proposing a project similar to MiCA.
