Cryptoassets in property transactions

Guest article written by Stephen Ward, Director of Strategy and External Relations, The Council for Licensed Conveyancers

In response to the increasing number of enquiries received from CLC practices about the use of cryptocurrencies, the CLC included several questions on this topic in its Annual Regulatory Return (ARR) for the period January to December 2024. 

Returns submitted by CLC practices reinforced the fact that whilst the majority of CLC practices currently do not accept cryptocurrency, there are a small number that would accept cryptocurrency (which has been converted to pound sterling) and there is seemingly an increasing appetite for the use of cryptoassets to fund property transactions. However, the CLC recommends that practices should exercise extreme caution.  

The National Risk Assessment (NRA)

The National Risk Assessment (NRA), published in the last couple of weeks, highlighted a significant risk of money laundering through the use of cryptoassets.  The report notes that “The risk of money laundering through cryptoassets has increased significantly since 2020 with cryptoassets increasingly appearing in money laundering intelligence over this period.” The NRA also highlighted that “…Whilst Bitcoin remains an attractive cryptoasset for illicit finance and serious and organised crime (SOC), stablecoins such as Tether are now most commonly used to launder money.” The NRA dedicated an entire section to cryptoassets which can be found here.

The CLC is in the process of developing guidance about cryptocurrency which will take into account the NRA as well as the information we have been provided with through the ARR and other means. It is the CLC’s intention to publish this guidance before the end of the year.

Be vigilant and exercise extreme caution

Evidence quite clearly points to cryptoassets being a significant red flag for practices and the CLC would urge practices to be vigilant and exercise extreme caution in any transaction before accepting cryptocurrency.  This is a complex area involving very elaborate schemes which are difficult to trace and which may lack transparency (particularly regarding the source of funds which is a crucial AML obligation). The CLC recommends that practices considering transactions involving crypto assets should:

1. develop policies relating to the acceptance of cryptocurrency to ensure they are acting consistently;
2. Have regard to the current cryptoasset regulatory regime which is maintained by the FCA;
3. include cryptocurrency considerations in their practice wide risk assessment (PWRA) and take the NRA 2025 into account in the PWRA;
4. Ensure that staff are trained appropriately on what can and cannot be accepted as well as red flags and warning signs;
5. Ensure that key AML obligations such as source of funds are answered satisfactorily and, if not, be prepared to terminate the transaction and make a report to the NCA if necessary;
6. Contact either their assigned Regulatory Supervision Officer or Manager (RSM/RSO) if they have any questions about such transactions or the CLC’s dedicated AML inbox: [email protected].

Howden perspective:

Cryptoassets in property transactions – a professional  indemnity lens

As the adoption of cryptoassets in property transactions begins to surface amongst CLC-regulated firms, Howden recognises both the innovation and the inherent risk this trend introduces, particularly from a professional indemnity insurance (PII) standpoint.

Key Concerns for Insurers

1. Heightened Money Laundering Risk - the 2025 National Risk Assessment (NRA) underscores a significant increase in money laundering activity involving cryptoassets, with stablecoins like Tether now more commonly used than Bitcoin. This elevates the exposure of conveyancing firms to regulatory breaches, especially where source of funds cannot be adequately verified. From a PII perspective, this raises the risk of claims arising from failure to detect or report suspicious transactions.
2. Lack of Transparency and Traceability - Cryptoasset transactions often lack the audit trail and transparency of traditional banking systems. This makes it difficult for firms to meet their AML obligations, particularly around source of funds and client due diligence. Insurers may view this as a material risk, potentially leading to exclusions or higher premiums for firms engaging in such transactions without robust controls.
3. Regulatory Uncertainty - with the CLC still in the process of developing formal guidance, and the FCA’s regulatory framework for cryptoassets evolving, there is a risk of firms operating in a grey area. This regulatory ambiguity can lead to inconsistent practices and increased exposure to negligence claims, especially if a transaction later proves to be linked to criminal activity.
4. Operational Readiness and Staff Training - the CLC has highlighted the need for clear internal policies and staff training. From a PII perspective, failure to implement these measures could be construed as a breach of duty, particularly if a claim arises from a staff member’s lack of understanding of cryptoasset risks.

Scott Thorne

Associate Director, Financial Lines Group

This article has been written by Stephen Ward, Director of Strategy and External Relations, The Council for Licensed Conveyancers and the opinions and views stated in this article are those of Stephen Ward and not Howden Insurance Brokers Limited (“Howden”). Howden is an insurance broker and is not authorised or regulated to advise on cryptoassets in property transactions. Howden shall not (i) owe or accept any duty, responsibility or liability to you or any other person; and (ii) be liable in respect of any loss, damage or expense caused by your or any other party’s reliance on this article.