UK Insolvency Service Appoints Crypto Specialist Amid 420% Case Surge

The UK Insolvency Service has taken a proactive step to address the growing complexity of insolvency cases involving cryptocurrencies by appointing its first crypto intelligence specialist. This move is in response to a significant increase in the number of crypto-related insolvency cases, which have risen by 420% over the past five years. The estimated value of crypto assets identified in these cases has also surged dramatically, increasing 364 times to 523,580 British pounds.

Andrew Small, a former police investigator with a background in economic crime, has been appointed to lead efforts in tracing and reclaiming crypto assets that have not been accounted for in insolvency and criminal proceedings. Small's role will involve providing specialist knowledge about the various types of cryptocurrencies and the technology used to buy, sell, and store them. This includes everything from Bitcoin and Ether to memecoins like Dogecoin and non-fungible token artworks.

Small's appointment is part of a broader effort by the Insolvency Service to enhance its capabilities in recovering digital assets. The service is tasked with tracing and recovering money and assets from individuals or companies in insolvency cases to return as much of the funds owed to creditors as possible. Small's expertise will be crucial in helping investigators deal with cases where crypto asset ownership is a factor.

The rise in crypto ownership in the UK has been substantial. A study found that 12% of UK adults owned crypto in 2024, a significant increase from the 4% reported in 2021. This trend highlights the growing importance of cryptocurrencies in the financial landscape and the need for specialized knowledge to effectively trace and recover these assets.

In addition to the appointment of Small, the UK is also taking steps to more tightly regulate the crypto industry. Beginning January 1, 2026, UK crypto companies will need to collect and report data from every customer trade and transfer. This includes the user’s full name, home address, tax identification number, the cryptocurrency used, and the amount moved. This new rule is part of the UK’s integration of the Organisation for Economic Development’s Cryptoasset Reporting Framework to improve transparency in crypto tax reporting.

Neil Freebury, head of intelligence at the Insolvency Service, expects Small’s appointment to enhance collaboration and strengthen outcomes for investigators working on crypto asset ownership cases. "His appointment will help our investigators dealing with cases where cryptoasset ownership is a factor," Freebury said. This development underscores the UK's commitment to adapting to the evolving financial landscape and ensuring that creditors receive the maximum possible return from insolvency cases.