Cryptocurrency seizure: now the state wants private keys too

*by Fulvio Sarzana di S.Ippolito, Lawyer, Sarzana and Partners Law Firm. Sarzana Law Firm and Associates

Legislative Decree 186/2026 tells the prosecutor where to send the seized cryptocurrencies. It doesn't yet tell him how.

In summary. Legislative Decree 186/2026, effective October 31, changes the seizure of cryptocurrencies: the judge must obtain the coins and, where possible, the private cryptographic keys, and allocate them to the Single Justice Fund. He or she can order their early sale, and those acquitted will receive a sum of money with interest, not their bitcoins. Rules for storing the keys are still missing; they will be established by a Prime Ministerial decree.

Thirty seconds from the phone, and the wallet is empty. That's all it takes for whoever has the private key to empty a bitcoin account, even while the Finance Police are searching their home.

This is why cryptocurrency seizures, so far, have almost always ended up in a press release and nothing else. There's no counter to notify the decree. There's no account to block. There's a string of characters, and either you have it or you don't.

Legislative Decree 25 September 2026, n. 186, in Official Journal on October 16th and in force from the 31st, tries to close the loophole. It incorporates a 2024 European Directive on Asset Recovery and it touches on several things, from confiscation for equivalent value to front men. The part that concerns us here is another.

When a judge seizes crypto assets, he must now obtain the coins and, where possible, the means to access them. The decree calls them by their proper name: private cryptographic keys.

Destination: the Single Justice Fund, the same container where money and assets seized in criminal proceedings have been ending up for years, which since the end of October has also hosted a service dedicated to digital wallets.

The nature of cryptocurrency seizures is changing. Previously, it was a ban: those funds are untouchable. Now, it's a transfer. In Brussels, they call it effective dispossession, which, translated from bureaucratic jargon, means that the asset must actually leave the hands of those who hold it.

And what if it's not possible? The decree gets by with a flexible formula, any other procedure that ensures the authority exclusive custody and control. Basically, make do. Which is what prosecutors and judicial police have been doing for years, only now it's written into a law.

The broadcaster's mailbox

The order must be communicated to two parties: the person who issued the crypto-assets and the person the recipient of the seizure has appointed to safeguard them, if they can be identified.

If the coins are deposited on an exchange platform, it works because the platform receives the order and blocks the account.

Regarding the issuer, however, there are more than one doubts regarding the regulatory formulation.

Bitcoin has no issuer. No one legally created it, no one manages it, and there is no company with a registered office and certified email address. The rule makes sense for stablecoins and tokens created by an identifiable entity. For the cryptocurrency that gives its name to the entire subject, it doesn't.

Then comes the most difficult scenario, that of the private wallet: a flash drive in a drawer, or twelve words memorized but never written down anywhere. There's no one there to notify. Either the key turns up during a search, or the suspect cooperates. And since handing over the private key means handing over all the assets, it seems unlikely that this will happen in the vast majority of cases.

Cryptocurrency seizure: who loses if the price moves?

An apartment seized in January is worth roughly the same in December. Ten bitcoins can halve in six weeks, or double, and a criminal trial can take years.

The decree responds indirectly, with an early sale. If the goods cannot be preserved without deterioration or disproportionate costs, the judge orders their sale. The interested party may request a hearing, but has fifteen days to do so.

You can appeal, but the lien does not suspend the sale.

Once the asset is sold, the seizure is transferred to the sum collected.

Applied to bitcoins, the rule goes like this: the state can liquidate them during the ongoing trial and keep the euros. The treasury is protected from collapse, which is understandable. And if confiscation fails, in preventive proceedings the proceeds are returned to the interested party with interest.

Interest. Not the value those coins would have today.

Whoever is acquitted gets a sum of money back, not their bitcoins. If the price has risen in the meantime, so be it.

In 2014, the U.S. government auctioned off nearly 30,000 bitcoins seized on Silk Road, at around $630 each. The buyer got the deal of the century. The U.S. Treasury, a little less so.

The rest, for those who have a fortune

A few lines on how the decree changes outside the crypto world, because it affects many more people.

Equivalent confiscation extends to the instruments of the crime: if the object is missing, the judge seizes assets of equal value, even those registered to a nominee, calibrating the amount based on the seriousness of the crime and the financial circumstances of the convicted person.

Then there's the third. When the convicted person no longer has any equivalent, the transferred property can be seized by someone unrelated to the crime. It's not enough that the property has changed hands: it must be ascertained that the recipient knew, at the time, what the transfer was for.

The most important piece is missing

The service at the Single Justice Fund exists. The rules for its operation don't.

How private keys are physically stored, with what security systems, what infrastructure requirements, how long it will take, and under what conditions it can be sold: everything is left to a decree from the Prime Minister, upon a proposal from the Ministry of Economy and Justice, in agreement with the Ministry of the Interior, and after consulting the National Cybersecurity Agency. Four administrations plus one agency. As for the timing, it's best not to make any predictions.

A prosecutor who seizes bitcoins today therefore knows where he should send them in theory but does not know how.

As always, the void will likely be filled by the offices' practices regarding the seizure of cryptocurrencies. On this topic, see also the in-depth analysis of the study on computer seizure and cryptocurrencies and on the legal aspects of bitcoin.

Frequently Asked Questions About Cryptocurrency Seizures

An earlier version of this article was published on October 20, 2026, on Fulvio Sarzana's blog on Il Sole 24 Ore.