The Crypto World patiently continues to struggle with a centralized economy. Some countries successfully adapted to the new rules of the developing crypto space and accepted the fact of using a decentralized technology. While others can’t resolve this riddle and regulate crypto properly.
Despite the fact that one of the main cryptocurrencies in the world — Bitcoin (BTC) — has already turned 15 years old, there are still disputes about crypto regulation. SimpleSwap made its TOP-5 of the most notorious litigations related to cryptocurrency over the past 5 years. Check it out:
#1 “Kleiman v Wright”
In 2018, the Florida District Court (USA) received a lawsuit from Ira Kleiman, a well-known computer forensic scientist, who claims to be one of the creators of Bitcoin. It was filed against Craig Wright, a researcher at nChain. Kleiman accused Wright of stealing 1.1 million BTC after proclaiming himself the founder of Bitcoin, Satoshi Nakamoto.
In the course of the investigation, which was conducted by specialists from WizSec, interesting details of the relationship between Kleiman and Wright were revealed. Criminologists were puzzled by the fact that Kleiman’s lawsuit admits Wright’s story about “creating Bitcoin” to be the truth. But then Ira Kleiman accuses him of fraud and multiple deceptions. Basically, the plaintiff was making serious accusations against the person he refers to as a reliable source of information.
The investigation showed that most of the Bitcoin addresses to which Wright allegedly transferred assets were not in his possession at all. Moreover, Wright does not have access to presumably Satoshi Nakamoto’s wallet. Many analysts doubt that this 1.1 million BTC ever existed. Apparently, this case will remain a mystery, like everything connected to the personality of Satoshi Nakamoto.
#2 “The Italian job” or bankruptcy of BitGrail
On February 8, 2018, an unknown hacker withdrew 15 million XRB (Nano) tokens from the Italian crypto exchange BitGrail. It was worth more than $170 million at that time. As a result, the exchange declared itself bankrupt and suspended its activities.
The case was heard in New York District Court. The police found out that the cyber attack was carried out by the founder of BitGrail, Francesco Firano. Moreover, it seems that Firano deliberately did not strengthen the BitGrail security systems when the first cyber attack happened. He also hid from users the fact of missing funds for some time, which was revealed only on February 8th.
#3 Prohibition on advertising of cryptocurrencies and ICOs
In the same 2018, Facebook and Instagram blocked all ads related to crypto assets. Next up was Google. The ban on publishing advertisements about cryptocurrencies and ICOs provoked a wave of indignation among users. It got to the point that Cryptocurrency and Blockchain associations in Russia, Korea and China created a lawsuit against Facebook, Google, Twitter and Yandex. Representatives of Switzerland, Armenia and Kazakhstan supported this action.
The lawsuit was planned to be filed in May 2018 in New York District Court on behalf of the new Eurasian Cryptocurrency and Blockchain Association. The goal was to convey to the representatives of Facebook and Google that the distribution of advertising content will have a beneficial effect on the development of the entire crypto industry. There is no official statements that this lawsuit was filed.
#4 The collapse of Terra
The year 2022 is marked by the community as the worst year in the history of cryptocurrency. It began with a major fall in Bitcoin price, and was accompanied by collapses of crypto exchanges. Especially huge was the fall of the algorithmic stablecoin TerraUSD, which in May 2022 lost its peg to the US dollar and practically depreciated, despite all attempts to save it.
After a while, the project was restarted, and it even created an airdrop for all investors. Sadly, all these efforts did not even get close to covering all the losses that brought the fall of Terra to its customers.
In February 2023, the US Securities and Exchange Commission (SEC) filed a lawsuit against the founder of the Terra crypto exchange, Do Kwon, accusing him of fraud. Kwon is suspected of embezzling several billion dollars.
#5 Coinbase account hack
March 2023 began with an unpleasant surprise — a certain user named Jared Ferguson filed a lawsuit against a major exchange Coinbase. User claimed that he lost all savings from his account. The amount of stolen funds is about $96 thousand. Jared said that he was a victim of a hack back in May 2022, but Coinbase refused to help him, placing the blame on the user himself. The case is being investigated by a federal court in San Francisco.
The Crypto World has long crossed the line of an ideal existence without centralization and monopolies. It has become a part of our usual life. And, of course, like any system, it is far from ideal, and it cannot exist without conflicts and trials. Crypto trading can be convenient and profitable, but it has its risks.
Maybe in the future large crypto companies will improve their security systems, and user funds will be protected by new algorithms that could not be hacked. And someday all countries will come up with suitable regulations for crypto. For now the crypto sector has troubles with it,that’s why such cases appear with lawsuits. The outcome is not always in favor of users, but filing a case often becomes the only way to solve the problem. We hope that soon everything will get better and crypto will be regulated around the world.
Do you agree with our list? What lawsuits would you add to it? Share your thoughts in the comments below!
If you want to learn more interesting facts about crypto then don’t forget to check out our blog! You might like our articles “Gemini Exchange Wants to Leave the US” and “SEC Against Binance and Coinbase”.
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SimpleSwap reminds you that this article is provided for informational purposes only and does not provide investment advice. All purchases and cryptocurrency investments are your own responsibility.
Originally published on our Publish0x blog.