UK police and the National Crime Agency (NCA) have been given greater powers to seize, freeze and destroy cryptoassets being used by criminals.

The Home Office announced on Friday that it had updated proceeds of crime and terror legislation to make it easier for law enforcement to investigate, capture, and recover illicit crypto.

NCA estimates suggest that illicit crypto transactions linked to the UK were likely to have reached at least £1.2 billion in 2021, if not "significantly higher".

Changes to the law mean that police are no longer required to make an arrest before seizing crypto from a suspect.

Items that could be used to give information to help an investigation, such as written passwords or memory sticks, can also now be seized.

Officers will be able to transfer illicit cryptoassets into an electronic wallet which is controlled by law enforcement, meaning criminals can no longer access it.

Additionally, UK law enforcement will be able to destroy a crypto asset if returning it to circulation is not "conducive to the public good". Privacy coins, for example, are a form of cryptocurrency that grant an extremely high degree of anonymity and are often used for money laundering.

Victims will also be able to apply for money belonging to them in a cryptoassets account to be released to them.

“Criminals should never be able to benefit from breaking the law which is why we are making it much easier for law enforcement to stay on top of a new and developing threat,” said home secretary James Cleverly. “These reforms will also enhance our national security. Terrorist organisations like Daesh are known to raise funds through crypto transactions and these updated powers will enable our agencies to more easily strip them of their assets.”

Earlier this year, the NCA worked with the United States Drug Enforcement Administration to investigate a multi-million drug enterprise which led to $150 million, in cash and crypto, being seized.

Cryptoassets were also seized in a case where three men sold counterfeit drugs on the dark web and accepted crypto as payment, amassing £750,000 in the process. They were jailed for more than 20 years between them.

"Criminals are increasingly using crypto assets to conceal and move the proceeds of crime at scale and pace, pay for other criminal services and as a means to defraud victims," said Adrian Searle, director of the National Economic Crime Centre. "These new powers are very welcome and will enhance law enforcement’s ability to restrain, recover and destroy crypto assets if required."

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