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Sweden: Bitcoins Seized During Asset Seizure

(Nov. 7, 2017) On October 12, 2017, the Swedish Kronofogden (Enforcement Authority) announced that it had for the first time seized Bitcoin assets in the course of actions taken against a debtor and that it would auction them off during an online auction. (Press Release, Kronofogden, Nu kan du köpa bitcoin hos Kronofogden [Now You Can Purchase Bitcoins with the Kronofogden] (Oct. 12, 2017), Enforcement Authority website.) The Enforcement Authority estimated that the Bitcoins seized held a market value of approximately SEK23,000 (about US$2,822), and so this was the amount used to initially estimate of the money available to offset the debt owed by the person who owned the Bitcoins. (Information About the Activities of the Swedish Enforcement Authority, KRONOFOGDEN (last visited Oct. 26, 2017).)

Under Swedish law, one of the tasks of the Enforcement Authority is to seize property from indebted persons upon the application of the state, a creditor, or a debtor. (1§ Förordning med instruktion för Kronofogdemyndigheten [Regulation with Instruction for the Enforcement Authority] (Svensk författningssamling [SFS] 2016:1333), RIKSDAGEN; Lag om betalningsföreläggande och handräckning [Act on Payment Orders and Judicial Assistance] (SFS 1990:746), RIKSDAGEN; Skuldsaneringslag [Act on Debt Clearance] (SFS 2016:675), RIKSDAGEN; Information About the Activities of the Swedish Enforcement Authority, supra.) The most common debts that the Enforcement Authority enforce are ones resulting from unpaid “television licenses, maintenance obligations, student loan grants, traffic insurance, debts concerning cellular telephones and internet connections, and quick loans (SMS loans).” (Information About the Activities of the Swedish Enforcement Authority, supra.)

The Bitcoins were auctioned off at Auktionstorget. (F9492. Bitcoin och Bitcoin Cash, AUKTIONSTORGET (last visited Oct. 19, 2017).) Auktionstorget is the Enforcement Authority’s executive auction site where seized property is auctioned off to the highest bidder. (The Swedish Enforcement Authority’s Auction Site, KRONOFOGDEN (last visited Oct. 26, 2017).) The final bid was SEK43,000.00 (about US$5,277), received on October 19, 2017. (Id.) According to the Enforcement Authority, the extra SEK20,000 (aboutUS$2,450) obtained above the estimated value will be applied to further pay off the debtor’s debt. (Nu kan du köpa bitcoin hos Kronofogden, supra.)