What to Do If ICE or HSI Seizes Your Cryptocurrency

Attorney Carolina Nunez is Florida based and advises clients on cryptocurrency seizure defense, civil asset forfeiture, and digital asset protection. Call (407) 900-FIRM

An email arrives from Homeland Security Investigations or an agent shows up with a seizure warrant. Your Coinbase account is frozen. Your Binance US balance is gone. Or your self-custody wallet has been drained into a government-controlled address. If this has happened to you, the clock is already running.

Under the Civil Asset Forfeiture Reform Act (CAFRA), the federal government has strict notice deadlines, and you have strict deadlines to fight back. Miss them and your crypto is gone for good.

This guide walks through what happens when ICE or HSI seizes cryptocurrency, the statutory framework that controls the process, the deadlines you cannot miss, and the defenses that can get your digital assets back.

Cryptocurrency seizures by HSI, the FBI, IRS-Criminal Investigation, and the U.S. Secret Service have become routine in 2025 and 2026, often under the long-standing HSI Directive 18-04 governing seizure and forfeiture of cryptocurrency.

LEGAL DISCLAIMER: This article provides general informational content regarding federal civil asset forfeiture of cryptocurrency. It does not constitute legal advice and does not create an attorney-client relationship. Forfeiture procedures, deadlines, and rights vary by agency, statute, and case. If your cryptocurrency has been seized by a federal agency, consult a licensed attorney immediately. Deadlines in CAFRA cases run from the date notice is mailed, not the date you read it.

What Happens When ICE or HSI Seizes Your Cryptocurrency

HSI is the principal federal investigative arm of the U.S. Department of Homeland Security.

Under HSI Directive 18-04, agents can seize Bitcoin, Ethereum, USDT, USDC, and other digital assets when there is probable cause to believe the coins represent proceeds of a federal crime or were used to facilitate one.

Common triggering investigations include money laundering, wire fraud, narcotics trafficking, human smuggling, child exploitation offenses, and sanctions violations. Once seized, cryptocurrency is transferred into a government-controlled wallet and held pending the forfeiture process.

A federal Notice of Seizure issued under CAFRA triggers strict legal deadlines, including the critical 35-day window to file a claim and fight to recover seized cryptocurrency before permanent forfeiture.

Three Ways Agents Seize Cryptocurrency

Federal agents typically obtain cryptocurrency in one of three ways.

• First, they serve a seizure warrant on a centralized exchange (Coinbase, Kraken, Binance US, Gemini) and the exchange transfers the target balance to the government's custodial wallet.

  
  

• Second, they work directly with stablecoin issuers like Tether and Circle, who can freeze USDT and USDC at the smart-contract level.

  
  

• Third, when they obtain the private keys to a self-custody wallet through a suspect's cooperation, a device seizure, or forensic recovery, they sweep the wallet into government control.

Each pathway is authorized under civil or criminal forfeiture statutes including 18 U.S.C. § 981 and 18 U.S.C. § 982.

The Notice of Seizure Starts the Clock

After a nonjudicial seizure, the agency must send a written Notice of Seizure to every interested party as soon as practicable and in no case later than 60 days after the date of seizure under 18 U.S.C. § 983(a)(1)(A).

• For state or local seizures turned over to a federal agency, the deadline extends to 90 days.

  
  

• The notice lists the property seized, the statutory basis, the address where claims are filed, and the deadline for filing.

  
  

• That deadline is at least 35 days from the date the notice was mailed, not received. Administrative forfeiture notices are also published on forfeiture.gov.

Administrative vs. Judicial Forfeiture

If the seized cryptocurrency is valued at $500,000 or less, the agency can generally forfeit it administratively without ever filing in court.

• If the value exceeds $500,000 (or involves real property), the government must proceed judicially in federal district court under 19 U.S.C. §§ 1607 and 1610.

  
  

• Since crypto prices move rapidly, valuation is measured at the time of seizure.

  
  

• If you do nothing, the property is declared forfeited by default, and the only way back is the narrow motion under 18 U.S.C. § 983(e).

The CAFRA Deadlines You Cannot Miss

CAFRA imposes hard statutory deadlines on both sides. The government must send written notice within 60 days of seizure under 18 U.S.C. § 983(a)(1).

You must file a verified claim by the deadline stated in the personal notice letter, which is at least 35 days from the mailing date. Once you file a timely claim, the government has 90 days to either file a civil judicial forfeiture complaint in federal court or include the property in a criminal indictment.

Miss your deadline and the property is forfeited by default. Miss theirs and, under 18 U.S.C. § 983(a)(3), the government must return the property unless it has an independent basis to hold it.

Your Four Options After the Notice Arrives

When the Notice of Seizure arrives, the claim information page at forfeiture.gov lists four possible responses.

• First, if you do nothing - that results in automatic forfeiture.

  
  

• Second, file a Petition for Remission or Mitigation, which asks the agency to return the property as a matter of discretion. Note: The petition does not stop the administrative forfeiture and does not preserve your right to federal court review.

  
  

• Third, file a verified Claim for Court Action, which forces the government to file a judicial forfeiture complaint and shifts the burden of proof to the government.

  
  

• Fourth, file both.

In almost every cryptocurrency case, the right answer is to file a timely verified claim, because it preserves your rights and forces the government to prove its case in court.

Defenses in a Crypto Forfeiture

Case

Under 18 U.S.C. § 983(c), once a claim is filed, the government bears the burden of proving by a preponderance of the evidence that the property is forfeitable and that there is a substantial connection between the property and the alleged offense.

Common defenses include the innocent owner defense under 18 U.S.C. § 983(d), lack of a substantial nexus between the crypto and any criminal activity, insufficient blockchain tracing, statute of limitations, and violations of the Excessive Fines Clause of the Eighth Amendment under 18 U.S.C. § 983(g). If the government filed a defective complaint or missed a notice deadline, a Rule 41(g) motion for return of property may be available as well.

Value Fluctuation and the Strategic Bitcoin Reserve

Cryptocurrency prices can swing dramatically between seizure and final forfeiture. Historically, seized crypto was liquidated at auction by the U.S. Marshals Service.

That changed with Executive Order 14233 establishing the Strategic Bitcoin Reserve, which now directs the federal government to retain forfeited Bitcoin long-term rather than auction it. For claimants, this raises a critical valuation question: if you prevail and get your property back, do you receive the original coins, today's USD value, or the seizure-date value?

Under 28 C.F.R. Part 8 and case law, claimants who prevail are generally entitled to the return of their original property or its equivalent, but disputes over valuation and interest are common and fact-specific.

Florida and State Law Considerations

While most large cryptocurrency seizures are federal, state and local law enforcement also seize digital assets. States like Connecticut (HB 6990) and Texas (SB 1498) enacted crypto-specific forfeiture statutes in 2025.

Florida applies its general Florida Contraband Forfeiture Act (Fla. Stat. §§ 932.701-932.7062) to cryptocurrency, which requires an adversarial preliminary hearing on request and imposes strict notice requirements.

If state authorities seized your crypto and turned it over to a federal agency for forfeiture under the equitable sharing program, federal CAFRA deadlines still control.

What to Do Right Now If Your Crypto Was Seized

Preserve every document. Save the seizure warrant, notice letter, emails, exchange screenshots showing the freeze, transaction hashes, and wallet addresses. Note the exact date the notice was mailed, because the 35-day claim deadline runs from that date. Do not post publicly about the case.

Do not authorize the exchange or custodian to release any additional information without counsel. Identify whether the seizure is administrative (under $500,000, handled by the agency) or judicial (filed in federal court).

Check forfeiture.gov for the published notice. Then retain a Florida attorney who handles cryptocurrency forfeiture to evaluate your options and file a verified claim before the deadline expires.

Do Not Miss the 35-Day Deadline.

If HSI, ICE, the FBI, IRS-CI, the DEA, or the U.S. Secret Service has seized your Bitcoin, Ethereum, USDT, USDC, or any other digital asset, Attorney Carolina Nunez serves clients across Orlando, Winter Park, Daytona Beach, Kissimmee, Sanford, Lake Mary, DeLand, Casselberry, Altamonte Springs, and all of Central Florida.

Whether the case involves civil asset forfeiture defense, a verified claim for court action, or an innocent owner defense, deadlines are unforgiving and the evidence must be built immediately.

Call (407) 900-FIRM or click here to fill out our online case review.

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Federal cryptocurrency seizures by ICE, HSI, FBI, or IRS-CI are governed by 18 U.S.C. § 983 (CAFRA). The government must send notice within 60 days, and you typically have 35 days from mailing to file a verified claim. If you act, the government has 90 days to file in court. Missing deadlines results in forfeiture.

Cases involve Coinbase freezes, Binance seizures, stablecoin locks, or wallet transfers. Defenses include innocent owner, lack of nexus, and improper tracing.

Attorney Carolina Nunez handles crypto seizure defense in Orlando and Central Florida. Call (407) 900-FIRM.

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