A New Zealand High Court judge has delivered a ruling in the long-running case involving defunct cryptocurrency exchange, Cryptopia. According to the judgment, the funds the exchange lost last year belong to the individual owners of the accounts, and are not to be viewed as owned by the company.
Via its official Twitter account, Cryptopia announced the ruling delivered by Justice Gendall.
“Today, 8 April 2020, Justice Gendall delivered his judgement finding firstly, cryptocurrencies are “property”… and secondly, that account holders’ cryptocurrency were held on multiple trusts, separated by individual crypto-asset type. This means that the cryptocurrencies are beneficially owned by the account holders and are not assets of the company.”
In January 2019, Cryptopia suffered a breach which lasted for two weeks even after it was discovered because the exchange couldn’t regain full control. In that time, Cryptopia lost over $30 million, out of the $170 million it held across 800,000 accounts, in nearly 900 different assets. The breach is still regarded as the biggest hack in New Zealand.
As part of the liquidation process, the liquidators approached the Christchurch High Court to determine whether or not the account holders are entitled to the funds or if it could be classified as debts with creditors.
The ruling confirms that the funds will not be regarded as creditors’ debts.