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Tim Aron represents Bitfinex in landmark Bitcoin judgment

Tim Aron recently represented Bitfinex in AA v Persons Unknown [2019]  in a landmark Bitcoin judgment which recognised  Bitcoin as property under English law.

In proceedings following hacking and encryption, the court permitted a claimant insurer to be anonymised, granted their application for a private hearing and granted a proprietary injunction against all four defendants.

The Commercial Court has allowed a private hearing of an insurer’s application for injunctive relief in proceedings following system hacking and payment of a ransom in Bitcoin.

Bryan J was satisfied that CPR 39.2(3)(a), (c), (e) and (g) applied. Publicity would defeat the object of the application as it may alert those in possession of the bitcoin and enable them to dissipate the property. There was also the risk of further cyber or revenge attacks on the claimant if they were to be named. The application also involved confidential information and was made without notice, and it might be unjust to refer to respondents in public. Therefore, it was necessary to sit in private to ensure correct administration of justice.

Bryan J noted that it was important to assist those who had suffered blackmail and extortion finding that it was a misuse of free speech which tempered the usual interests of justice and freedom of expression (LJY v Persons Unknown [2017] EWHC 3230 (QB)). He was satisfied that the requirements under section 12 of the Human Rights Act 1998 were met for a private hearing, as in PML v Persons Unknown [2018] EWHC 838 (QB). He was also satisfied that the application was properly made without notice and the insurer could be anonymised.

At an interim hearing before Mr Justice Bryan, it was held that a crypto asset such as Bitcoin can constitute property for the purposes of English law. In so finding, the Commercial Court considered that the recent legal statement by the UK Jurisdictional Taskforce on crypto assets and smart contracts represented an accurate statement as to the position of crypto assets under English law.

Tim Aron is a commercial barrister and specialist in financial services law and regulation. Tim’s practice focuses on advisory and regulatory enforcement work for FCA and PRA regulated firms and individuals. To instruct Tim, please contact Matt Sale (+44 (0)20 7427 4910) or Peter Foad (+44 (0)20 7427 0807).

News 27 Jan, 2020

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