An Act Concerning The Seizure And Forfeiture Of Virtual Currency And Virtual Currency Wallets.
HB 6990 creates a new framework for Connecticut to seize and forfeit virtual currency and virtual currency wallets when they are used in, or represent proceeds from, specified criminal offenses. The bill applies this authority to several categories of crimes, including certain theft and fraud offenses, drug-related offenses, money laundering, and offenses involving sexual exploitation and other serious crimes. It also updates multiple existing forfeiture and search-and-seizure statutes so that virtual currency and wallets are treated like other forms of property under those laws.
The bill sets out procedures for forfeiture proceedings, including a 90-day deadline for prosecutors to petition the court after seizure, notice requirements to owners and interested parties, a clear-and-convincing-evidence standard, and a hearing process with appeal rights. It preserves protections for innocent owners and lienholders, and it exempts property used to pay legitimate attorney’s fees. In several sections, the bill authorizes electronic notice when appropriate for virtual currency cases and clarifies that virtual currency kiosks themselves are not subject to seizure or forfeiture under the new section.
The bill’s impact on state law is to modernize Connecticut’s forfeiture and search warrant statutes by expressly including virtual currency, virtual currency wallets, and their contents within definitions of property, stolen property, and equivalent property. It also directs forfeited assets to existing state funds depending on the underlying offense, such as victim compensation, drug asset forfeiture, privacy protection, and criminal injuries compensation accounts. In practical terms, it gives law enforcement and prosecutors explicit authority to pursue crypto assets tied to criminal activity and to use existing forfeiture procedures for those assets.
Overall sentiment around the bill appears strongly supportive and largely noncontroversial in the legislative record. The bill advanced unanimously in committee and on the floor in both chambers, with no recorded nay votes in the votes provided. That pattern suggests broad bipartisan agreement that the law needed updating to address digital assets in criminal investigations and forfeiture cases.
The main points of contention, as reflected in the text rather than the voting record, are the usual civil forfeiture concerns: protecting innocent owners, ensuring due process, and preventing seizure of property used for legitimate legal defense. The bill addresses those issues directly by requiring court proceedings, notice, proof by clear and convincing evidence, and exemptions for innocent owners and attorney’s fees. Another notable policy choice is that the bill expressly excludes virtual currency kiosks from seizure or forfeiture under the new crypto-specific section, which limits the reach of the new authority.
The bill amends Connecticut forfeiture, search warrant, and related criminal procedure statutes to expressly include virtual currency and virtual currency wallets as property subject to seizure, forfeiture, and evidentiary treatment. It also revises definitions of contraband, stolen property, monetary instruments, and equivalent property so that digital assets are treated similarly to cash and other forfeitable assets under existing law. The changes apply to multiple offense categories and direct forfeiture proceeds into existing state funds tied to victims, drug enforcement, privacy protection, and criminal injuries compensation.
The legislative sentiment appears overwhelmingly favorable. The bill received unanimous committee and floor votes in both chambers, with no recorded opposition in the vote history provided. That suggests lawmakers broadly agreed that Connecticut needed to update its laws to address the use of cryptocurrency in crime and to give prosecutors and courts clear procedures for handling those assets.
There is little evidence of overt political contention in the available record, but the bill touches on issues that often raise concern in forfeiture law: due process, notice to owners, protection of innocent third parties, and the risk of taking property used for legitimate legal defense. The bill responds to those concerns by requiring court oversight, a clear-and-convincing standard, notice to owners and interested persons, and exemptions for innocent owners and attorney’s fees. A narrower policy choice is the express exclusion of virtual currency kiosks from seizure or forfeiture under the new crypto-specific section, indicating some limit on enforcement reach.