Texas Passes SB1498, Authorizing Seizure of Digital Assets Linked to Criminal Activity - Cryptured.com

Legislators in Texas enacted Senate Bill 1498 on June 20. This bipartisan measure allows law enforcement to seize digital assets such as Bitcoin (3.79%), NFTs, stablecoins, and other cryptocurrencies linked to criminal behavior. The measure was approved in its entirety and will go into effect on September 1.

The new law allows for the seizure of digital assets that were obtained or exploited in criminal activities such as organized crime, drug trafficking, fraud, theft, or human trafficking. Additionally, the state may claim any rise in the value of the confiscated assets between when they were obtained and when they were taken.

Any confiscated property linked to these offenses would have to be transferred by law enforcement to a safe offline wallet that is only accessible by the agency or the state’s lawyer. The county in which the seizing agency is located would be the venue for the forfeiture case.

The same civil asset forfeiture laws that now govern cash, cars, and real estate used in illegal activities will now apply to digital property thanks to SB1498. Since digital assets are becoming more and more involved in financial crimes, lawmakers claimed SB1498 fills in the legal gaps.

Arizona is also revising its legislation to include digital assets in the state’s forfeiture statutes.

Together with SB21, which Texas Governor Greg Abbott signed on June 22, SB1498 makes Texas the first state to set aside public funds and establish a mechanism exclusively for Bitcoin keeping. The reserve, which is run independently of the main treasury, is intended to act as a hedge against inflation and improve the state’s financial stability.

In addition, Texas has joined Arizona and New Hampshire as the third US state to enact a Bitcoin reserve law.