Unparalleled decision in UK court: bitcoin is property

Posted 23 August, 2019

The UK court has made a historically unparalleled decision when it considered Bitcoin as property during the hearing of the hacking case. The hearing is an interim and the decision is subject to ratification. 

With this decision, the UK court system has recorded the first time when the crypto asset was classified as a property, which can mean that victims of hacks can more easily get cryptos from the platforms that faced hacks.

 According to the case information, the CEO of Alphabit fund Liam Robertson claimed last month that he had lost $1 million in bitcoins due to fraud activities. London Commercial Court ordered that US cryptocurrency exchange Coinbase had to freeze the funds. 

For reference, the UK legal system classifies bitcoin as data, so crypto owners cannot require the return of coins in case of theft. At the same time, the plaintiff layers managed to convince the court that the theft did not mean a transfer of ownership right, so Robertson remained the legal owner of bitcoins.
 This situation arose in early July. Alphabit CEO during the telephone talk with the representative of the fund agreed to transfer more than 100 BTC for the product the latter offered. It was stated that their conversation was tapped. Just after the talk, an unknown individual in the figure of the investment fund head sent to Robertson an e-mail indicating an address of the crypto wallet.
 When the theft was detected, 80 BTC were transferred to Coinbase, 15 BTC – to LocalBitcoins and 5 BTC – to another wallet.

Notably, Liam Robertson stated that the hacker returned the funds from Coinbase under pressure from the ongoing investigation. For now, he plans to get back the remaining funds, though it can be a challenge since they are kept on non-exchange wallets. Robertson can return money anyway using the court order, though it may take much more time and costs. 
 At present, the court is waiting for the review of the consulting task force that is to decide whether it will acceptable to approve bitcoin as property.

The decision is expected by September.

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