They could, according to the U.K. High Court...
In the recent decision of Wang v Darby  EWHC 3054 (Comm), His Honour Judge Stephen Houseman QC (sitting as a Deputy Judge of the U.K. High Court) had the following comments to make at paragraph 89 of his Judgment, in Obiter:
"the transfer of digital assets from one account-holder to another for the purpose of baking or stake bonding could involve or constitute a trust. That would depend on all the circumstances, including whether a loan or sale was the more appropriate characterisation to give effect to the parties' commercial objectives."
This is the first time that an English court has addressed the question of whether a cryptocurrency could be held on trust. The exact question itself was not an issue to be determined in the immediate case, but the court made time to make the helpful observation in Obiter.
The question has previously been considered in the New Zealand High Court – in Ruscoe v Cryptopia Ltd (In Liquidation)  NZHC 728, it was held that a cryptocurrency is a digital asset capable of ownership, and therefore is property, and in turn capable of being held on trust.
In 2019, the U.K. High Court established that cryptocurrencies – although not tangible – do constitute property (AA V Persons Unknown EWHC 3556 (Comm)). In AA, the court considered and applied the definition adopted by the U.K. Jurisdiction Taskforce in its Legal Statement on Cryptoassets and Smart Contracts at paragraph 35, which says:
"Strictly, the term property does not describe a thing itself but a legal relationship with a thing: it is a way of describing a power recognised in law as permissibly exercised over the thing. The fundamental proprietary relationship is ownership: the owner of the thing is, broadly, entitled to control and enjoy it to the exclusion of anyone else. However, ownership is just one kind of property right: property is a comprehensive term and can be used to describe many different kinds of relationship between a person and a thing."
Relevant to the immediate question, and to other crypto assets such as nonfungible tokens (NFTs), the Legal Statement goes on to say, at paragraph 37:
"Of particular significance are the rules concerning succession on death, the vesting of property on personal bankruptcy, the rights of liquidators in corporate insolvency, and tracing in cases of fraud, theft or breach of trust. It would, to say the least, be highly unsatisfactory if rules of that kind had no application to crypto assets."
The defendant in Wang v Darby accepted that cryptocurrencies could be held on trust, and the court agreed in principle. Whether or not a trust had actually arisen in this instance, however, turned on its facts.
Going forward, it seems likely that the U.K. High Court will be faced with similar questions as more and more cryptocurrency disputes chart their way to court in this fast-developing area. We don't have a definitive answer to our question yet (although it does seem counterintuitive for cryptoassets not to be property and incapable of being held on trust), but this is a helpful insight into how the English courts are currently thinking.
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