![]() A ransom demand was made – the first defendant demanded payment of Bitcoins in exchange for the decryption tool. The first defendant had bypassed the company’s firewalls and installed malware called “Bitpaymer”, which encrypted its computer systems. In that case, the plaintiff was the insurer for a Canadian insurance company which had been hacked by the first defendant. While Birss J, who heard the case, was satisfied that the court could make such an order if it was appropriate to do so, there was no suggestion before him that cryptocurrency could not be a form of property, or that a party “amenable to the court’s jurisdiction cannot be enjoined from dealing in or disposing of it” ( Money-4 Limited at ).Ħ0 The point on whether cryptocurrency could be a form of property was more fully developed in AA v Persons Unknown who demanded bitcoin on 10th and 11th October 2019 and ors EWHC 3556 (Comm) (“ AA”). When such confirmation was not forthcoming, the application for the freezing order was sought. The applicant’s lawyers had asked for confirmation from that the cryptocurrency was still in their possession and that it had not been dissipated. ![]() The applicant had given to some 293 Bitcoins and 400 Ethereum with a combined total value of £1.5 million. For example, in Elena Vorotyntseva v Money-4 Limited t/a and ors EWHC 2596 (Ch) (“ Money-4 Limited”), the applicant brought an urgent, ex parte application for a freezing order against the first respondent, Money-4 Limited trading as, and its directors. It provides instructions to the computer under a system whereby the “owner” of the NFT has exclusive control over its transfer from his wallet to any other wallet.ĥ9 In the same vein, there has been growing judicial support for “deploying property concepts to protect digital assets”: Personal Data as a Proprietary Resource at p 96. In the context of NFTs, the information concerned is a string of computer code (at its essence, zeros and ones) that does not provide any knowledge to those who have read it. When Lord Upjohn used the term “information” in Boardman v Phipps, he was using it in the context of the knowledge that such information informs the reader. The real objection to treating information as property depends on the functions it is used for rather than on the plain fact that it is information: David Fox and Sarah Green, Cryptocurrencies in Public and Private Law (Oxford University Press, 2019) at para 6.44. To characterise NFTs as mere information would ignore the unique relationship between the encoded data and the blockchain system which enables the transfer of this encoded data from one user to another in a secure, and verifiable fashion. NFTs, when distilled to the base technology, are not just mere information, but rather, data encoded in a certain manner and securely stored on the blockchain ledger: see Amir Soleymani v Nifty Gateway LLC EWHC 773 at Hermès International and Hermès of Paris, Inc. The question then, which Justice Falk had to decide, was whether the requirements to obtain leave for service out of jurisdiction as summarised in VTB Capital plc v Nutritek International Corp & Ors EWCA Civ 808 at – were satisfied, namely:ĥ8 I agree with Gendall J’s observations in Ruscoe. ![]() This meant that the court had to reconsider whether, effectively by rehearing, permission to serve out should be given: Tulip Trading at. However, several of the defendants challenged the court’s jurisdiction. ![]() Permission to serve out of jurisdiction was granted on 7 May 2021. TTL filed a claim, alleging that the defendants owed it a fiduciary and/or tortious duties, and applied for service out of jurisdiction. TTL’s case was that the defendants, none of whom were within the jurisdiction, were the core developers and/or otherwise controlled the software in respect of the relevant digital asset networks. The claimant in that case, Tulip Trading Limited (“TTL”), was the subject of a hack which rendered it unable to control, or use, a very substantial amount of Bitcoin which it claimed to own. 28 The claimant also referred me to the case of Tulip Trading v Bitcoin Association for BSV & Ors EWHC 667 (“ Tulip Trading”).
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