Core Insights - The rapid development of the digital economy has positioned cryptocurrencies as new vehicles for value transfer and investment, while also providing new avenues for criminal activities [1] - The U.S. government has established a Strategic Bitcoin Reserve (SBR) and adjusted its digital asset seizure policy to hold confiscated cryptocurrencies as long-term national assets rather than selling them immediately [1][3] - This policy shift not only alters asset management practices but also drives the evolution of legal frameworks, blockchain intelligence technologies, and victim compensation mechanisms [1][3] Summary by Sections U.S. Digital Asset Seizure Dynamics - On March 6, 2025, President Trump signed an executive order establishing the SBR and U.S. digital asset reserves, marking a significant shift in U.S. cryptocurrency policy [3] - The White House stated that confiscated bitcoins will be managed by the Treasury Department as a strategic reserve to strengthen the global position of the dollar and hedge against inflation risks [3] - It is estimated that the U.S. government currently holds approximately 200,000 to 400,000 bitcoins, valued at several billion dollars, through criminal and civil seizures [3] Legal Framework for Asset Seizure - The legal basis for U.S. digital asset seizures relies on several key statutes, including: - 18 U.S.C. § 981(a)(1)(A) & (C): Allows civil forfeiture of assets linked to crimes like money laundering without requiring a criminal conviction [3] - 18 U.S.C. § 982(a): Mandates criminal forfeiture following a conviction for money laundering-related crimes [4] - 21 U.S.C. § 853(p): Permits the seizure of substitute assets when direct proceeds of crime cannot be recovered [5] - 31 U.S.C. § 9705: Supports the management of seized assets through the Treasury Department [6] - 28 U.S.C. § 524(c): Allows the inclusion of digital assets in the Justice Department's asset forfeiture fund [7] Enforcement Tools and Practices - U.S. law enforcement agencies have demonstrated advanced technical capabilities in tracing and seizing digital assets, utilizing tools such as Chainalysis Reactor and TRM Labs to track cross-chain transactions [9] - Collaboration with cryptocurrency exchanges and stablecoin issuers has enabled the freezing or destruction of implicated assets, as seen in a recent case where €27 million in crypto assets were frozen in Spain [9] - Judicial procedures require law enforcement to obtain court authorization to prove the connection between assets and criminal activities, with potential claimants being notified through blockchain messages and official announcements [9] Recent Case Studies and Victim Compensation - In 2025, the Justice Department seized $225.3 million in cryptocurrency related to a "cryptocurrency trust scam," showcasing the effectiveness of real-time blockchain analysis [10] - The executive order prioritizes using seized assets to compensate victims, with remaining assets allocated to the SBR or law enforcement funding [10] - The government has implemented structured liquidation policies to maximize asset value while minimizing market impact, alongside safety custody plans to protect against price volatility and hacking risks [10] Policy Considerations and Future Directions - The rapid evolution of digital asset seizures raises multiple policy considerations, including: - Balancing enforcement with due process to ensure the rights of innocent owners are protected [16] - Managing risks associated with holding large amounts of cryptocurrencies, including price fluctuations and cybersecurity threats [17] - Enhancing international coordination to standardize legal frameworks and optimize asset-sharing agreements [18] - Legislative reforms may enhance protections for claimants, improve asset management transparency, and develop new investigative tools [19]