Julian Assange has lost an appeal to have his arrest warrant for jumping bail dropped, meaning the Wikileaks founder looks set to stay holed up in London's Ecuadorian embassy.

Assange, who is entering his sixth years inside the embassy, had hoped to have his warrant rescinded because it had "lost its purpose and function" now he is no longer wanted by Swedish authorities over sexual assault allegations.

The whistleblower took his appeal to Westminster Magistrates Court, with the Crown Prosecution Service (CPS) saying that "hypothetically" Assange would be free to leave the embassy and not face arrest by British police if he was successful.

However, CPS lawyer Aaron Watkins argued it would be "absurd" for Assange to be "effectively rewarded with immunity" by evading judicial proceeding for a long enough time that they "fall away".

Judge Emma Arbuthnot has not dismissed the appeal as she does not accept Assange's arguments for it to be dropped, meaning the 46-year-old will still face arrest if he sets foot outside the embassy in Knightsbridge.

The Wikileaks founder entered the embassy in 2012 over fears he would be extradited to the US to face espionage charges if arrested while a rape investigation was still active.

In May 2017, Swedish prosecutors announced they will drop their sexual assault investigation against Assange, but he remained inside as he still was wanted by British police for jumping bail.

Assange was recently granted Ecuadorian citizenship as part of a bid to apply for diplomatic immunity so he can leave the embassy without being arrested.

The request was rejected by the UK Foreign Office, adding in a statement: "Ecuador knows that the way to resolve this issue is for Julian Assange to leave the embassy to face justice."

Julian Assange
Wikileaks founder Julian Assange appears at the window of the balcony prior to making an address to the media in May 2017 JUSTIN TALLIS/AFP/Getty Images