UK Appoints Specialist to Recover Crypto from Bankruptcy Cases

The UK Insolvency Service has appointed Andrew Small as its first crypto intelligence specialist to recover lost crypto assets from bankruptcy cases. There’s been a 420% increase in crypto-related insolvency cases over five years, with the value of these assets skyrocketing. The UK is also tightening regulations, requiring crypto firms to report detailed customer transaction data starting January 2026.

The UK Insolvency Service has made a significant move by appointing its first crypto intelligence specialist in a bid to recover lost crypto assets from bankruptcy and criminal cases. Andrew Small, who previously worked as a police investigator focused on economic crime, will spearhead the efforts to trace and reclaim unaccounted crypto assets, as announced in a statement on June 9.

The appointment of Small comes amid a staggering increase of 420% in crypto-related insolvency cases over the past five years. During this period, the identified value of crypto assets within these cases surged 364 times, now totalling about 523,580 British pounds, which is approximately $709,500. This sharp rise, according to Small, reflects the growing ownership of crypto in the UK, leading to a corresponding increase in bankruptcy cases involving these digital assets.

Small emphasized that cryptocurrencies are “very much a recoverable asset,” indicating that a variety of digital currencies will be targeted for recovery. The UK’s Insolvency Service is responsible for tracking down and retrieving funds owed to creditors from individuals or companies facing insolvency. This includes an array of assets from popular cryptocurrencies like Bitcoin (BTC) and Ether (ETH) to more niche varieties like Dogecoin (DOGE) and even non-fungible token (NFT) artworks.

Neil Freebury, head of intelligence at the Insolvency Service, expressed confidence that Small’s expertise would boost collaboration and enhance results for investigators working on crypto ownership cases. The goal is to provide clear pathways to assets that could benefit creditors during insolvency proceedings.

In line with this appointment, the UK has seen a notable rise in crypto ownership among its citizens. A study by the Financial Conduct Authority released last November revealed that 12% of UK adults owned cryptocurrency as of 2024, a significant jump from just 4% in 2021. The average value of their holdings now stands at approximately 1,842 British pounds or $2,496.

These moves also coincide with the UK government’s broader strategy to tighten regulation within the crypto sector. Starting January 1, 2026, UK crypto firms will be required to collect and report extensive data for every customer transaction. This includes customers’ full names, home addresses, tax identification numbers, as well as details about the cryptocurrency traded and the amounts involved.

This new reporting rule is part of the UK’s adoption of the Organisation for Economic Development’s Cryptoasset Reporting Framework. The aim is to enhance transparency and improve compliance within crypto tax reporting, thereby fostering a more accountable crypto market overall.

As these developments unfold, the landscape of cryptocurrency in the UK is changing rapidly, reflecting both rising interest and the need for clearer governance over these digital assets.