Precautionary measures on cryptocurrencies and NFTs in international litigation: how digital assets are located, frozen and held in custody
The number of commercial disputes involving cryptocurrencies or NFTs It grows steadily.
But unlike traditional assets, these can be transferred in seconds and with global reach.
That's why more and more judges are accepting urgent precautionary measures to secure cryptocurrencies before the trial.
This article analyzes how assets are located, what orders courts can issue, how exchanges cooperate, and what the usual technical-legal sequence is for seize or freeze crypto assets in different countries.
Why precautionary measures are essential in crypto assets
Cryptocurrencies do not behave like a bank account.
There is no such thing as a "balance in a bank" that can be automatically blocked.
There is no central registry either.
All of this increases the risk that the defendant will move the assets to another wallet or to a country beyond judicial reach.
Therefore, in cases of fraud, breach of contract, corporate disputes, or misappropriation, precautionary measures are requested to prevent the dissipation of the digital asset while the substance of the matter is being resolved.
Judges do not need to understand the technology in detail, but rather verify three classic elements:
- Appearance of good right.
- Risk that the defendant will conceal or transfer the asset.
- Proportionality of the measure.
When there is on-chain evidence or strong indications, most courts accept that there is a real and urgent risk.
Locating digital assets: how wallets and transactions are identified
Applicants must demonstrate that the asset exists and can be under the control of the defendant.
To this end, the following are provided:
- Wallet addresses known or inferred.
- Transaction History verifiable through public explorers (blockchain explorers).
- In case of NFTs, The smart contract address and the token ID.
- Emails, contracts, screenshots or communications that link the defendant to a platform or exchange.
- Blockchain analysis reports prepared by recognized providers.
This information allows the court to understand that the asset is identifiable and that it can move quickly if immediate action is not taken.
Types of precautionary measures used in various countries
There is no universal figure, but there are common practices among jurisdictions.
Countries of Anglo-Saxon tradition
(USA, Canada, UK, Australia, Singapore)
The main tool is the freezing orders: freeze orders that prohibit the disposal of specific assets, including cryptocurrencies.
They may be accompanied by:
- Disclosure orders: obligation to disclose wallets or custodians used.
- Transfer prohibitions applied directly to the holder.
In many cases they are executed even if the assets are in another jurisdiction, as long as there is a sufficient connection.
Continental europe
The typical figure is the prohibition of disposal of assets or lien.
Judges may order:
- The blocking of balances in exchanges that operate in that country.
- The delivery of information held by intermediaries.
- Measures on devices or keys if permitted by internal legislation.
Latin America
The measures vary according to each country's civil procedure, but it is common to:
- Order the account freeze on exchanges with a local presence.
- Request identifying information from the supplier.
- Impose alienation prohibitions on the asset holder.
In practice, success depends on whether the exchange has an operational structure in that jurisdiction and is obligated to fulfill the order.
How to execute a court order on an exchange
Centralized exchanges are the key point today: they are the only ones that can freeze balances immediately.
What can a court order?
A court can order an exchange:
- Temporarily block the user's account.
- Freeze cryptocurrencies, or NFTs under custody.
- Prevent withdrawals to external wallets.
- Provide KYC information or transaction history, when permitted by local law.
The order must clearly identify:
- The exchange and its country of operation.
- The specific account.
- Related addresses, if known.
Custody of the asset after freezing
The phase following the precautionary measure is critical: it must be ensured that the asset remains intact.
Custody on the exchange itself
It is the most common option.
The exchange maintains custody and marks the account with restrictions such as "judicial hold", "frozen" or similar.
AdvantagesTechnical security and no need to transfer keys.
InconvenienteIf the process takes longer, it may be necessary to update the order.
Judicial custody wallet or designated administrator
Some jurisdictions allow:
- Transfer the asset to a wallet controlled by a court administrator.
- Deliver the private keys under strict security conditions.
These options are only used when the legal infrastructure allows it, as they involve security and liability risks.
Characteristics of NFTs
NFTs present additional challenges:
- They may be hosted on platforms that do have control (custodial marketplaces).
- They may depend on metadata hosted outside the blockchain (Web2 servers).
- The judge can order the token to be frozen or prohibit its primary or secondary sale.
Frequently Asked Questions (FAQs)
There is no universally recognized system for recording liens on the blockchain with legal effects.
Some networks allow messages in transactions, but they lack legal effect as a registry entry.
The actual measurements are applied to the custody (exchange) or about the holder.
No. The wallet doesn't depend on any intermediary. The only way is:
Order the owner not to dispose of the asset.
Seize devices if the law allows it.
Impose procedural consequences for non-compliance.
Yes, if the NFT is held by a marketplace or platform that controls the key.
If it's in a private wallet, the same limitation applies as with cryptocurrencies.
Final point: a solid strategy requires technical and legal coordination
Precautionary measures regarding cryptocurrencies and NFTs are not experimental; they are already a consolidated reality in multiple jurisdictions.
However, effectiveness depends on two elements:
- Quickly identify the custodian (exchange or marketplace).
- Provide clear on-chain evidence to justify the urgency.
The key is to combine analyses blockchain, international procedural knowledge and a precise judicial request.
In an environment where assets can be transferred in seconds, speed and accuracy make the difference between securing wealth or losing it forever.
RRYP Global, cyberlegal lawyers.
