- UK High Court ordered Bitfinex to freeze Bitcoins worth $8,65,000 associated with a ransomware payment made in October 2019.
- Stuart Hoegner, the counsel to Bitfinex, told that Bitfinex helped claimant “to trace the stolen Bitcoin”.
In December 2019, the Commercial Court (High Court) in England and Wales has ordered Bitfinex, a Crypto-Exchange, to hold the Bitcoins worth $8.65,000. The major reason for freezing the Bitcoins was its linkage with a ransom payment made in October 2019.
Case in Detail
Per the order published on January 17, the hackers attacked the computer of an unnamed company back in October 2019. As a result, hackers demanded Bitcoin worth $1.2 million in ransom. The unnamed victim paid the ransom of 109.25 bitcoins (worth $993,500 as per the current rate) with the help of an insurance company.
Furthermore, the insurer hired a Blockchain analytics company Chainalysis to receive a track of where the Bitcoins paid as a ransom was used. According to Chainalysis, some of the Bitcoins were converted into Fiat and rest 96 Bitcoins were sent to an address on Bitfinex.
However, Madeleine Kennedy, the Director of Communications at Chainalysis, informed in one of its conversations that the cyber insurer used Chainalysis software to track the status of the Bitcoins transferred in ransom. The cyber insurer has traced the flow of funds from the point of extortion until it was loaded in one of the Bitfinex’s users. He also informed that,
“The insurer’s lawyers successfully petitioned the courts to freeze any funds related to the extortion.”
Subsequently, the court ordered Bitfinex to freeze the Bitcoins associated with the wrong ransomware payment. Also, the court has asked to share the KYC documents of the owner whose account had the Bitcoins submission.
When asked, Stuart Hoegner, the general counsel of Bitfinex, quoted a statement that the system placed in Bitfinex is robust. It always assists the law enforcement authorities and prosecutions in cases like this.
Continuing further, Hoegner also said that he feels that the claimant’s main attention is not on his client. The insurer is totally focused on tracing the stolen Bitcoins associated with October’s ransom payment. Hoegner was very sure that his client Bitfinex is entirely an innocent party and has completely mixed up with this wrong payment.
Darragh Connel, the general counsel of the insurance company told New Money Review following the case that the case is still ongoing. He also informed that,
“The return hearings will be done in some days before Mr. Justice Bryan who has reserved the case with himself.”
As per Daragh Connel, the present stage is an interim one and his client claim will be determined once the trial proceedings are done in the Commercial Court in London. As per the reports, this case has compelled the UK’s Commercial Court to accept Bitcoins as a form of property for the first time in history.