In a groundbreaking verdict, the high court of Singapore has officially recognized cryptocurrency as property that can be held in trust. This landmark ruling was made in a case involving Seychelles-based exchange Bybit and a contractor, as revealed in court documents on July 25. Bybit Fintech Limited filed a lawsuit against Ho Kai Xin, accusing her of secretly transferring USDT to addresses that she owned and controlled, as well as transferring fiat currency to her personal bank account, which violated her employment contract.
Seeking the return of the stolen cryptocurrency or its traceable proceeds, Bybit confronted the defendant after discovering unusual transactions. Initially, Ms. Ho claimed the payments were inadvertent mistakes or technical errors. However, she later accused her maternal cousin, Jason Teo, of stealing her personal identification, rendering her unable to access her accounts.
Presiding over the case, Judge Philip Jeyaretnam accepted the probabilities that “Jason not existing [or at any rate not playing the role asserted for him by Ms. Ho]”, and granted Bybit summary judgment against Ms. Ho. The plaintiff was awarded costs amounting to $45k, along with disbursements of $11.5k.
In his decision, the Singapore judge referenced a recent consultation paper from the Monetary Authority of Singapore (MAS). The proposed amendments in the paper supported the idea that cryptocurrencies can be identified and separated as digital assets and should be allowed to be held in trust. This aligns with a previous ruling by a Hong Kong court, which recognized cryptocurrencies as property that can be held on trust.
The recognition of cryptocurrencies as property provides important legal clarity and protection for individuals and businesses involved in cryptocurrency transactions. It establishes a precedent that cryptocurrencies have similar characteristics to traditional forms of property and can be subject to legal frameworks governing property ownership, transfers, and liability.
This ruling in Singapore reflects a growing acceptance and understanding of cryptocurrencies within the legal system. Other common law jurisdictions, such as Hong Kong and the United Kingdom, have also recognized cryptocurrencies as property. These developments signify a significant step forward in creating a regulatory framework that can effectively govern the use and ownership of cryptocurrencies.
The recognition of cryptocurrency as property opens up possibilities for the use of cryptocurrencies in various legal contexts, including estate planning, trust arrangements, and contractual agreements. It also provides a solid foundation for the development of financial products and services centered around cryptocurrencies, such as custody services and investment vehicles.
Overall, the Singapore court’s recognition of cryptocurrency as property sets a landmark precedent by acknowledging the legitimacy of cryptocurrencies within the legal framework. This development brings clarity and legal protection to individuals and businesses involved in cryptocurrency transactions, paving the way for further adoption and innovation in the cryptocurrency industry.