UK High Court Declares Tether as Property: Landmark Ruling for Cryptocurrency

UK Court Declares Tether as Property: First-of-Kind Decision for Crypto

The legal standing of Tether was a preliminary issue in a case initiated by a victim of fraud whose cryptocurrency, including Tether, was sold through several cryptocurrency exchanges following its passage through cryptocurrency mixers. In the decision on September 12, Deputy Judge Richard Farnhill of the High Court of Justice stated, “USDT attracts property rights under English law.” The judge further noted that USDT may be traced and could be considered trust property in the same manner as other types of property because it is a unique type of property that is not predicated on an underlying legal right.

The 2019 ruling in the same court, which was rendered without a trial, provided a “strong line of authority” that cryptocurrencies are property, according to the judge. In a 2023 digital assets report, the Law Commission for England and Wales marked them as property, and this view was also in line with theirs. The decision was made the day after a measure introduced by the UK government sought to make it clear that, for the purposes of property legislation, NFTs, cryptocurrencies, and carbon credits are all “things” and “personal property.”

Fabrizio D’Aloia’s Case Against BitKub Fails Due to Lack of Proof in Tether Scam

According to the judge, the victim and suit plaintiff, Fabrizio D’Aloia, was unable to demonstrate that BitKub, a Thai exchange, was enriched by obtaining 400,000 USDT, of which 46,291 USDT was purportedly tracked back to D’Aloia’s fraudsters. While acknowledging the scam, Farnhill wasn’t convinced that D’Aloia’s USDT was received by a BitKub wallet due to the usage of cryptocurrency mixers.

The judge found that USDT could be identified in mixed pools in theory, according to Bitkub’s attorney Nicola McKinney of Quillon Law, but D’Aloia “could not provide evidence on the balance of probabilities that any of his USDT could be traced to the relevant Bitkub wallet.” According to Farnhill, there was no defective transaction to undo between Bitkub and D’Aloia.

The legal link connecting Mr D’Aloia with Bitkub is simply missing from his claim. For this reason, too, he cannot succeed in his breach of trust claim.

Farnhill

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