Crypto and digital asset investigations in Italy
There is no Italian offence of using cryptocurrency. What is prosecuted is what the assets are used for or how the activity is carried on: laundering and self-laundering, fraud, unauthorised provision of financial services, tax offences. Wallets and accounts are seized during the investigation, well before any judgment.
What is actually charged
| Charge | Typical setting | Provision |
|---|---|---|
| Laundering | Converting proceeds through exchanges or mixers | Art. 648-bis Criminal Code |
| Self-laundering | The author of the offence reinvesting proceeds | Art. 648-ter.1 |
| Computer fraud | Manipulation of systems or data to obtain assets | Art. 640-ter |
| Fraud | Investment schemes and misrepresentation to investors | Art. 640 |
| Unauthorised financial activity | Operating without the required registration | Banking and financial legislation |
| Anti-money-laundering obligations | Failures by obliged entities | Anti-money-laundering legislation |
| Tax offences | Undeclared gains and unfiled returns | Legislative Decree 74/2000 |
The charge that catches people who consider themselves entirely legitimate is the fifth. Providing exchange or custody services in Italy requires registration, and operating without it is an offence in its own right regardless of whether any client was harmed. Foreign platforms serving Italian users have been prosecuted on precisely that basis.
Self-laundering and the word that limits it
The provision punishes the author of an offence who reinvests the proceeds in economic or financial activity in a way that concretely obstructs identification of their criminal origin. That adverb is the defence.
Converting funds through a registered exchange, with identity verification completed and a full transaction history, obstructs nothing: the chain is more traceable than a bank transfer, not less. What does obstruct is chain-hopping, mixers, privacy coins, and the layering of wallets with no economic purpose — and the difference has to be shown with the data rather than asserted.
Seizure of wallets and accounts
Preventive seizure applies to digital assets as it does to anything else, and it reaches assets held with exchanges, which comply with orders. Where the assets are self-custodied, seizure is executed by taking control of the keys, which raises its own questions about how that was done and what else was accessed.
- Ten days from execution to apply for review before a court.
- Check how the alleged profit was calculated: valuation dates and exchange rates are frequently chosen unfavourably and set the ceiling of everything that follows.
- Establish exactly which addresses and accounts are covered, because orders are often drafted more broadly than the alleged facts support.
- Where assets belong to third parties, that has to be raised by them and not only by the person under investigation.
The general framework on seizure is in getting seized property back and on financial proceedings in financial crime investigations in Italy.
Blockchain analysis is evidence, and it is contestable
These cases rest on chain analysis produced by commercial tools, and the output is usually presented as fact. It is not: attribution of an address to a person, clustering of addresses into a single wallet, and the labelling of counterparties are all probabilistic, and the underlying methodology is proprietary.
The defence questions are consistent. How was the address attributed to this person, and on what basis? What is the error rate of the clustering? Has the defence been given enough to test the result, or only the conclusion? The parallel with encrypted messaging evidence is exact, and is dealt with in the guide on encrypted evidence.
Frequently asked questions
Is using cryptocurrency illegal in Italy?
No. What is prosecuted is what the assets are used for, or carrying on the activity without the required registration.
I converted funds through a regulated exchange. Is that laundering?
Self-laundering requires conduct that concretely obstructs identification of the criminal origin. A verified exchange with a full transaction history is more traceable, not less.
Can they seize my wallet?
Yes. Assets held with exchanges are reached through the platform, and self-custodied assets by taking control of the keys. The seizure can be challenged within ten days.
Is blockchain analysis conclusive?
No. Attribution, clustering and labelling are probabilistic and produced by proprietary tools, and the defence is entitled to enough information to test the result.
If assets have been frozen
The ten days run from execution, and the valuation used in the order is usually the first thing worth attacking. First contact is free and covered by professional privilege.