Seizure of High-Value Digital Assets for Forfeiture
The forfeiture of high-value cryptocurrency under the Civil Asset Forfeiture Reform Act of 2000 (CAFRA) presents unique legal and procedural challenges that differ from those involving traditional high-value property. These differences arise primarily due to the technological nature of cryptocurrency, its traceability, and the complexities of its valuation and commingling.
While the legal framework for forfeiture under CAFRA applies broadly to both cryptocurrency and traditional property, the unique characteristics of cryptocurrency—such as its traceability, volatility, and pseudonymity—introduce distinct procedural and evidentiary challenges that require careful consideration in forfeiture proceedings.
If your digital assets were frozen or seized for forfeiture, you need an attorney with experience in civil forfeiture law, technical knowledge of cryptocurrency, with trial and appellate experience in federal forfeiture cases.
Asset Forfeiture Attorneys for the Seizure of High Value Digital Assets for Forfeiture
The attorneys at Sammis Law Firm represent clients in high-value cryptocurrency and digital asset forfeiture actions. We focus on federal civil forfeiture law, particularly under statutes such as 18 USCS § 981 and 18 USCS § 983.
We are familiar with the procedural requirements under the Supplemental Rules for Admiralty or Maritime Claims and Asset Forfeiture Actions. Additionally, we have a strong understanding of cryptocurrency transactions and blockchain technology, as these are often central to tracing and contesting the forfeiture of digital assets.
Attorney Leslie Sammis has technical knowledge of blockchain technology and cryptocurrency transactions. As such, she is equipped to challenge the government’s tracing methods or present evidence of legitimate ownership. She works with the top forensic experts when tracing cryptocurrency.
The firm has successfully conducted jury trials in forfeiture cases and taken them up on appeal. We work hard to ensure that our clients’ due process rights are protected at each stage of the proceedings. Contact us today for a free consultation.
Call 813-250-0500.
Jurisdictional and Procedural Thresholds
The courts have held that under CAFRA, assets valued at more than $500,000 must be forfeited through judicial proceedings rather than nonjudicial administrative processes. 18 USCS § 983, Bautista v. Mayorkas, 644 F. Supp. 3d 748 (2022).
This threshold applies equally to cryptocurrency and traditional property. However, the valuation of cryptocurrency can be particularly complex due to its volatile nature, which may complicate determining whether the $500,000 threshold is met at the time of seizure or forfeiture.
For example, in United States v. Tetherus, 2026 U.S. Dist. LEXIS 41874 (2026), the court noted that high-value cryptocurrency seizures necessitate judicial forfeiture proceedings, rendering the nonjudicial notice requirements of 18 USCS § 983 inapplicable (although it did not address the applicability of the 90 day deadline requirement to high value property).
Traceability and Commingling
Cryptocurrency’s technological traceability introduces unique challenges in forfeiture cases. While cryptocurrency transactions are recorded on public ledgers (e.g., blockchain), tracing specific assets to criminal activity can be complex, particularly when funds are commingled.
Under limited circumstances, the courts have considered applying the commingled funds doctrine to cryptocurrency to treat the entire accounts as forfeitable when legitimate and illegitimate funds are mixed. In other cases, the courts have found that the commingled funds doctrine does not apply.
Cryptocurrency and digital asset cases are complicated by the fungibility and rapid transferability of cryptocurrency, which may obscure the origins of specific assets.
Burden of Proof and Substantial Connection
Under CAFRA, the government must establish by a preponderance of the evidence that the property is subject to forfeiture and demonstrate a substantial connection between the property and the alleged offense. 18 USCS § 983, United States v. $ 291,828.00 in United States Currency, 536 F.3d 1234 (2008).
In cases involving cryptocurrency, this burden may be more difficult to meet due to the pseudonymous nature of transactions and the potential for obfuscation through techniques such as mixing services or privacy coins.
The courts have emphasized the heightened burden of proof under CAFRA compared to pre-CAFRA standards, requiring the government to demonstrate a substantial connection rather than merely a nexus. United States v. Sum of $185,336.07 United States Currency, 731 F.3d 189 (2013).
Notice and Due Process Concerns
The procedural requirements for notice under CAFRA, including timely and adequate notice to interested parties, apply equally to cryptocurrency and traditional property. However, the unique characteristics of cryptocurrency may raise additional due process concerns.
The government might argue that a long delay in providing notice was justified due to the complexity of the investigation and the need to maintain secrecy in a sealed criminal case. The government often seeks longer delays in cryptocurrency cases due to the intricate nature of tracing and investigating digital assets.
Complexity of Third-Party Claims
Cryptocurrency cases often involve competing claims from third parties asserting superior interests in the forfeited assets. For example, in United States v. Lichtenstein, 2025 U.S. Dist. LEXIS 65321 (2025), the court noted the complexity of adjudicating third-party claims in cryptocurrency cases, particularly when tracing hacked or laundered assets.
This complexity may necessitate ancillary proceedings to resolve disputes, further distinguishing cryptocurrency forfeitures from those involving traditional property.
This article was last updated on Friday, May 22, 2026.
