Which law applies to your crypto assets?

Anyone involved in a dispute over bitcoins or other crypto-assets faces a question that traditional goods never raise: which country’s laws actually govern these assets? The short answer: there is currently no definitive rule of law applicable anywhere, not even in Belgium, but case law worldwide is converging on a single criterion: the place of residence of the person who controls the private key.

Why a Bitcoin isn't stored anywhere

A house is located in a single country. A painting hangs in a single museum. A bitcoin, on the other hand, exists as an entry on a blockchain—a ledger maintained simultaneously by thousands of validation nodes spread across the entire planet. No single node is the ledger; each node holds a complete copy.

This poses a problem under private international law. The traditional rule of reference for rights in rem is tied to the location of the property, known as the lex rei sitae. Crypto-assets have no location: they are everywhere and therefore nowhere. Nor does the private key provide a reliable point of reference: the same key can exist simultaneously on a piece of paper in Ghent, in cloud storage in Dublin, and on a hardware wallet in Singapore.

This is not a theoretical issue. In the Tulip Trading ruling, $4.5 billion in digital assets were at stake following a hack; in the dispute involving the Three Arrows Capital fund, a Singaporean manager and liquidators in the British Virgin Islands fought over which court had jurisdiction over the crypto portfolio. In each case, the first question was: where are those assets legally located?

A claim, a security, or money: what is a crypto-asset under Belgian law?

The classification comes before the referral rule. The MiCA Regulation (Regulation (EU) 2023/1114 on crypto-asset markets) defines a crypto-asset as a digital representation of a value or right that can be electronically transferred and stored using distributed-ledger technology. That definition is regulatory, not civil law. It does not address whether you own a crypto-asset—such as a bicycle—or hold a claim—such as a bank account.

The traditional categories never quite fit. A claim presupposes a debtor, but Bitcoin and Ether have no issuer: there is no one against whom a claim can exist. The category of securities is not obvious either: according to the ESMA Guidelines on the Conditions and Criteria for Classifying Crypto-Assets as Financial Instruments, which the FSMA incorporated into its supervisory practice on February 10, 2026 (FSMA_2026_04), that classification presupposes an identifiable issuer and rights comparable to those of known securities—criteria that bitcoin and ether do not meet. And money? Crypto-assets fulfill the three classic functions of money (medium of exchange, store of value, unit of account) only imperfectly at best, although certain stablecoins may qualify as monetary substitutes.

What remains is the residual category of intangible movable property. For the purposes of conflict-of-laws rules, that classification is sufficient: ultimately, it is the applicable law that determines the substantive regime governing property rights. Since the Act of December 11, 2025 , the regulatory provisions of MiCA are fully incorporated into Belgian law, as we previously analyzed in our article on the Belgian MiCA Implementation Act. However, that regulatory framework does not resolve the property law issue.

What the Belgian CIPL is reporting today

There is no European regulation governing the applicable law for property rights. Belgian courts therefore rely on the Code of Private International Law (CIPL). Three provisions are relevant, and none of them specifically addresses crypto-assets.

Article 87, § 1 of the WIPR sets forth the basic rule: rights in rem in an asset are governed by the law of the state where the asset is located at the time such rights are invoked. For an asset without a location, that rule has no basis. Article 87, § 3 of the CIPL designates the law of the assignor’s habitual residence for rights in rem over a claim, but that provision presupposes precisely what is lacking in the case of Bitcoin: a claim and a debtor. Finally, Article 91 of the CIPL governs negotiable securities and refers to the registry in which the securities are registered in individual accounts. A blockchain is indeed a registry, but not one with a specific location, and according to the FSMA, most crypto-assets are not securities.

The Belgian judge who must rule today on the ownership of bitcoins therefore has no ready-made rule of reference. He will have to apply Article 87, § 1 of the CIPL by analogy and determine the location of the property. This is precisely where foreign case law offers inspiration.

The courts have opted to exercise control over the private key

Three rulings from three continents point in the same direction.

In the Tulip Trading ruling (High Court of England and Wales, March 25, 2022, [2022] EWHC 667 (Ch)), the English court accepted that the stolen digital assets could be located in England because the company that, in principle, exercised control over them was domiciled there. The location of the crypto-assets follows the person, not the technology.

The High Court of Singapore expressly concurred with this in its ruling Cheong Jun Yoong of Three Arrows Capital (High Court of Singapore, January 26, 2024, [2024] SGHC 21). Crypto-assets are located where the person who effectively holds the private key has his habitual residence. The Singaporean court preferred habitual residence over domicile as a more factual and stable criterion.

The Tokyo District Court went one step further in a case involving hacked bitcoins that had been siphoned off to a Japanese trading platform (T. prem. inst. Tokyo, Apr. 25, 2024, Reiwa 2 (wa) No. 19906, LLI/DB L07931064). The court first applied California law to the creation of the right of ownership, since the Bitcoin account had been opened with a California-based platform, and then applied Japanese law as the law of the current location: the Bitcoins were located in Japan because the Japanese company held the private keys there. The plaintiff lost the case because she could not prove that she herself had control over the means of access at the time of the hack. Control thus became both a criterion for determining location and a prerequisite for ownership itself.

This is a useful approach for Belgian practice. Anyone applying Article 87, § 1 of the CIPL to crypto-assets can properly determine jurisdiction based on the habitual residence or place of business of the person who exercises effective control over them. This criterion also applies to custody arrangements: if a regulated custodian holds the keys on behalf of its client, then effective control lies with that custodian, and the custodian’s place of business is identifiable and stable.

Legislative solutions: choice of law first

In addition to case law, three instruments offer solutions, with the choice of law at the top of the list in each case.

The Uniform Law Commission amended, in 2022, the U.S. Uniform Commercial Code to include a cascade rule: first, the law designated in the crypto-asset itself or its accompanying documentation applies; in the absence of such a designation, the generally chosen law applies; and, as a last resort, the law of the District of Columbia applies. Since then, 36 U.S. states have enacted these amendments. The last tier is, of course, acceptable only to the United States; the upper tiers—the explicit choice of law that is discernible to third parties—serve as a model worldwide.

The UNIDROIT Principles on Digital Assets and Private Law incorporated this into their Principle 5: first, the law chosen in the digital asset itself; second, the law chosen in the system; and third, the law of the issuer’s registered office. In substance, the principles structure commercial law around the same concept used in case law: control, understood as the actual power to dispose of the asset exclusively.

The Law Commission of England and Wales, chose in its consultation paper dated June 5, 2025 a more radical approach: in cases involving multiple jurisdictions, the court would no longer designate any applicable law at all, but would instead resolve the dispute directly on the merits. This raises some questions: a purely case-by-case approach offers insufficient legal certainty for the crypto markets, and the need for international harmonization of decisions does not disappear simply by ignoring it. The ongoing work of the The Hague Conference on Private International Law concerning digital assets should eventually bring uniformity to this area.

Specifically, what does this mean?

For account holders and service providers in Belgium, there are three practical lessons to be learned.

First: Include a choice of law provision. Article 75 of the MiCA Regulation already requires providers of custody and administration services to specify the applicable law in the client agreement. An explicit choice of law, made known to third parties, in the custody agreement or in the documentation for a token issuance is currently the most powerful tool for limiting uncertainty regarding the legal status of the transaction, even though it is not yet certain that every legal system will recognize that choice under property law.

Second: document your control. Anyone who wishes to assert ownership of crypto assets in a dispute must be able to prove that they actually held the private keys at the relevant time. The Tokyo ruling illustrates what happens without that proof: the claim is completely dismissed, even before the discussion of damages begins.

Third: the place of residence matters. As long as neither the legislature nor the contracting states introduce a specific rule of reference, there is a real possibility that a court will locate the crypto-assets at the habitual residence or place of business of the person who controls them. For a Belgian holder, this generally means Belgian law; for assets held in custody by a foreign custodian, a different law may apply than expected.

Frequently asked questions (FAQ)

Under which jurisdiction do my bitcoins fall if I live in Belgium?
There is no specific Belgian or European legal provision governing property rights in crypto-assets. By analogy with Article 87, § 1 of the CIPL and in line with international case law, a court will likely determine the location of your bitcoins based on where you, as the holder of the private keys, have your habitual residence. If you reside in Belgium, this would mean that Belgian law applies.

Does it matter whether my crypto assets are held on an exchange or with a custodian?
Yes. In the case of custody arrangements, effective control over the keys lies with the custodian, so that the custodian’s place of business can serve as the connecting factor. In addition, under Article 75 of the MiCA Regulation, the custody agreement must specify the applicable law; be sure to review that clause before you sign.

Can I choose which law applies to my tokens?
When issuing tokens, the issuer may include a choice of law provision in the asset itself or in the documentation. The UNIDROIT Principles and the U.S. UCC amendments recognize such a choice as the primary connecting factor, provided that it is explicit and made known to any third party. It has not yet been determined whether a Belgian court will accept a choice of law based purely on property law; however, including such a choice costs nothing and strengthens your position.

Conclusion

The question of which law governs ownership of crypto-assets remains unanswered by the Belgian legislature: the connecting rules of the CIPL are designed for tangible property with a specific location, claims against a debtor, and securities with a registry in a single location. International case law—from London to Singapore to Tokyo—fills this gap with a workable criterion: the law of the habitual residence of the person who effectively controls the private keys. Anyone in Belgium today who issues, holds, or litigates regarding crypto-assets would be well advised to have the choice of law and proof of control in order from the very beginning.