- Copytrack allowed tracking down and reclaiming the 530 ETH tokens it mistakenly credited to an investor.
- Judge insisted the tokens legally belonged to Copytrack, regardless of the transaction.
- Shanghai court declared Ethereum “a property” that is protected under the law in a similar case.
The Supreme Court of British Columbia has concluded a crypto-related case and made a landmark ruling that could have huge implications among cryptocurrency exchanges and users. The court has allowed a blockchain startup to repossess ETH tokens it erroneously sent an ICO investor.
Legal Implications of the Case
The ruling issued by Justice Ronald A. Skolrood allowed the Singapore-based blockchain startup Copytrack to proceed with the process of tracking down and reclaiming the amount of 530 Ethereum tokens it mistakenly credited to an investor who took part in their Initial Coin Offering (ICO). The 530 ETH was valued at $391,000 USD (CAD$495,000) but the current value is roughly $121,000 USD.
The court documents on the ruling show that a crypto investor Brian Wall took part in Copytrack’s Initial Coin Offering and subscribed to buy 530 CPY tokens but when the ICO was concluded, the blockchain sent him 530 ETH tokens instead of sending the CPY tokens he had ordered for; the current price for CPY tokens is about 5 cents which is a fraction of what ETH tokens cost.
In what may appear like a jinxed case, Copytrack contacted Wall and asked him to return the ETH tokens; he initially refused but later accepted only to change the story again claiming a hacker has infiltrated his cryptocurrency wallet and stolen the funds. Matters become worse when Wall died before the case could be resolved and further complicated issues.
The judge observed that the case raised many legal questions such as whether the ETH tokens could be classified as goods or something else but in the ruling; he reiterated that the tokens legally belonged to Copytrack, regardless of whether the transaction could be justified or not. The justice Skolrood stated that Copytrack may legally trace and recover the 530 ETH tokens they sent to Wall on February 15, 2018, wherever the said tokens will be found. The judgment read in part:
“While the evidence of what has happened to the Ether Tokens since is somewhat murky, this does not detract from the point that they should rightfully be returned to Copytrack.”
Ether Gets Legal Acknowledgement
The ruling follows a similar one in China where funds amounting to 20 ETH that was wrongly sent to an investor was brought to the Shanghai Hongkou District Court as the defendant refused to give back the funds; the court declares Ethereum “a property” that is protected under the law. The judgment raises a thorny issue where crypto funds are sent to a cryptocurrency exchange and unknowingly distributed to another user’s external wallet.
