UK Property (Digital Assets etc) Act 2025 Establishes Third Category of Personal Property

The UK Property (Digital Assets etc) Act 2025 received Royal Assent on September 11, 2025, and is in force as of that date. The Act amends English and Welsh property law by confirming that a thing in digital form — including a crypto-token, a digital file, or a non-fungible token — can be an object of personal property rights. The Act does not impose conditions on what specific digital things qualify; qualification turns on whether the thing satisfies the general common-law criteria for property. The legislation is final law, not a proposal, and applies throughout England and Wales.

Section 1 of the Act inserts a new provision into English personal property law stating: "A thing in digital form may be the object of personal property rights even if it is not a thing in action and is not a physical thing." This formulation creates a residual third category sitting alongside the two traditional categories — things in possession (physical objects) and things in action (rights enforceable by action, such as debts). Courts may draw on existing case law concerning digital assets, including the Line of cases from the UK Jurisdiction Taskforce's 2019 Legal Statement, when applying this provision.

The Act affects every market participant that holds, transfers, or litigates rights in digital assets governed by English law. Crypto exchanges, custodians, and wallet providers operating under English and Welsh law can now rely on statutory confirmation that digital asset holdings constitute property — enabling proprietary claims, tracing, and injunctive relief in insolvency and fraud proceedings. Investors in tokenised assets can assert ownership as a property right, not merely as a contractual claim. Lenders taking security over digital assets gain access to the full suite of proprietary security instruments under English law, including charges and pledges.

The Act does not define the full boundaries of the third category and leaves development of those boundaries to the courts. Scots law is excluded: the Act applies only in England and Wales. The Act does not itself regulate crypto-assets for financial services purposes — that regulatory function remains with the Financial Conduct Authority under the Financial Services and Markets Act 2000 and the forthcoming cryptoasset regime. No transitional provisions apply; the Act takes effect from the date of Royal Assent without a phase-in period.

Our firm advises digital asset businesses, crypto custodians, tokenisation platforms, and institutional investors on property law implications of digital asset structures under English law. We maintain a dedicated partner network of English law barristers and solicitors with experience in digital asset disputes and structuring. Contact us to assess how the Act affects your asset custody arrangements, security structures, or dispute strategy. Work we handle and assign includes digital asset property rights analysis, crypto custody legal opinions, tokenised asset structuring, insolvency and tracing claims involving digital assets, and cross-border enforcement of proprietary claims.

Source: UK Property (Digital Assets etc) Act 2025 (c. 29), Section 1. Official URL: https://www.legislation.gov.uk/ukpga/2025/29. Confirmed March 31, 2026.

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