Property (Digital Assets etc) Bill [Lords]

Will Forster Excerpts

2nd reading
Wednesday 16th July 2025 Commons Chamber

[Mr Will Forster (Woking) (LD)]

I rise in support of the Property (Digital Assets etc) Bill, which stands to bring our legal framework into the 21st century and better equip it to meet the challenges and opportunities of the digital age. This Bill is firmly rooted in the rigorous work of the Law Commission, which was followed by careful scrutiny in the other place. I thank peers for their work on the Bill, particularly Lord Tim Clement-Jones for scrutinising it on behalf of the Liberal Democrats.

This Bill confronts the long-standing legal ambiguity about how our common law system treats digital assets. As the Minister explained, and as I vaguely remember from my days at law school, the law as it stands recognises two primary forms of personal property—things in possession and things in action. However, we live in an ever-changing digital world, in which everything is much more based on digital than that common-law approach allows for. Digital assets, which cannot be physically possessed and often do not constitute a claim against another person, do not fall into the two traditional categories. Without clarity about the law, we risk undermining individual rights and weakening legal solutions in cases involving crypto assets, non-fungible tokens and other digital holdings. That is why this Bill matters; it ensures that digital things are not denied property status simply because they do not fall into the two normal categories. That is why the Liberal Democrats welcome the Government’s decision to accept the Law Commission’s recommendations.

This Bill is appropriate at this time, when we are seeing a growing use of digital assets across a variety of sectors. They are being used as investments, stores for value and tokens of identity and ownership by more and more people than ever before—recent figures from the Financial Conduct Authority indicate that nearly 12% of UK adults now hold crypto assets, a figure that has more than doubled since 2021. However, victims of fraud, those seeking restitution in cases of insolvency, or simply those wishing to assert ownership over what they rightfully hold have been operating in a murky legal landscape. This Bill leaves room for common law to develop in that sphere of property. That will help the law to reflect the ever-evolving nature of technology, but it must be monitored over time to ensure that regulation ultimately aligns with the need to protect individuals’ rights and support the economy.

We know that digital assets mean potential risks—whether fraud, abuse, or volatility—but ignoring them or failing to regulate them effectively will not make those risks disappear. A legal vacuum only increases the risk of criminality and injustice, while a clear, modern legal framework empowers the honest majority, boosts confidence and supports innovation. This Bill is measured, cautious and essential. It provides legal clarity, upholds property rights, and ensures that our laws remain relevant in the digital world. It is supported by the Law Society, by legal practitioners, and by the Liberal Democrats. I hope everyone in this Chamber supports it, too.