On 2 December, the Property (Digital Assets) Act 2025 received Royal Assent and came into force. The Act makes England and Wales some of the first countries in the world to legally recognise digital assets as personal property The Act ensures the UK remains at the forefront of rapidly evolving technological markets, reinforcing its position as a leading jurisdiction for legal and technological innovation It also provides legal clarity and certainty, while strengthening protections for digital assets such as cryptocurrencies and non-fungible tokens (NFTs).”
Background
The new Act follows a Law Commission report and draft Bill which highlighted the pervasiveness of digital assets in modern society. The report emphasised that, as many individuals treat digital assets as personal property, they should be afforded legal protection accordingly.
In recent years, courts had begun to develop common law to accommodate digital assets through cases like:
- AA v Persons Unknown [2019] EWHC 3556 (Comm) recognised Bitcoin as property capable of being subject to proprietary injunctions and freezing orders;
- Osbourne v Persons Unknown [2022] EWHC 1021 (Comm) established the same for NFTs, allowing them to be protected by the same remedies.
Despite these judicial developments, the lack of formal legislation left the issue of digital assets uncertain and vulnerable to change. This created unpredictability for estate planning, trust creation, matrimonial property division, and other uses of digital assets. The new Act provides statutory clarity and protection by codifying the principles which previously emerged from common law.
What does the Act do?
Historically, only two categories of personal property were recognised under English law:
- A thing in possession: tangible, movable and visible objects (such as cars or jewellery)
- A thing in action: rights which are enforceable through legal action or claims (such as debts or shares)
The Property (Digital Assets) Act 2025 now provides that:
“A thing (including a thing that is digital or electronic in nature) is not prevented from being the object of personal property rights”
This provision effectively establishes a new third category of personal property, enabling digital and electronic assets to be recognised as personal property.
Importantly, the Act does not provide a definitive list of what assets may qualify. Instead, it preserves flexibility for the courts to apply legislation in accordance with emerging technologies and new forms of digital assets, allowing the law to adapt and evolve with technological developments.
How may this affect wills and probate?
The Act provides clarity for individuals wishing to pass on digital assets as part of their estate. Testators can now safely include digital assets such as NFTs or crypto-currency in wills with the assurance that they will be recognised for purposes of inheritance and succession. They are capable of being inherited, transferred, and gifted in the same way as traditional forms of property.
For personal representatives, administrators and executors, the Act removed previous uncertainty by clarifying that digital assets can form part of the estate and may be managed and distributed to beneficiaries in the course of probate.
Additionally, digital assets can be held in trusts, providing new opportunities for the preservation, management, and controlled transfer of wealth across generations.
In cases of dispute, misappropriation or suspected theft, the courts retain the power to grant proprietary injunctions or freezing orders, helping to secure digital assets and protect estates and trusts.
How may this affect family law?
Though not immediately obvious, the Property (Digital Assets etc) Act 2025 has important implications for family law. By recognising digital assets as personal property, the Act allows them to be treated alongside traditional assets in divorce or separation proceedings. Most crucially, they can now be considered part of the matrimonial estate, enabling courts to take them into account when calculating equitable distribution.
They can also be included in cohabitation or nuptial agreements, providing greater certainty for the treatment of digital assets in the event of separation or divorce.
Next Steps for You
To ensure your digital assets are properly managed, protected, and reflected in your estate and family planning, you may wish to:
- Update wills and trusts to explicitly include digital assets
- Maintain secure records of access instructions for digital assets, such as passwords, passkeys, or crypto-wallet credentials, to ensure executors or trustees are able to access the property
- Review and update cohabitation or nuptial agreements to clarify the intended treatment of digital assets in the event of separation or divorce
- Reconsider overall estate planning strategies to account for digital holdings
Our family, wills and probate team is ready to advise you and assist with any of these steps, helping ensure that your digital and traditional assets are protected and managed according to your intentions.
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