Two Wyoming-based entities identified as ABC Company and XYZ Company just shook the markets with a court filing asking to transfer all of the dormant Bitcoin (BTC). Along with plaintiff Noah Doe, the legal lawsuit claims that 39,069 inactive Bitcoin (BTC) filled crypto wallets qualify as abandoned property under New York State laws.
Lost Property? $286 Billion Worth Of Bitcoin In Question
These wallets hold a whopping 3.7 million Bitcoins (BTC), roughly one sixth of the whole supply. The filing centers around the presumption that all of those crypto wallets qualify for abandoned property due to the original owners being unable to access them, alluding to the similar instances with unclaimed bank funds & lost property.
On top of that, the lengthy 901-page legal document lists wallets that are owned by Bitcoin’s (BTC) creator, Satoshi Nakamoto. Some of the more interesting choices include wallets tied to the massive Mt. Gox breach, but the keys aren’t going to get shuffled easily – Ripple’s Emeritus David ‘JoelKatz’ Schwartz argues it’s barely possible.
Ripple’s David Schwartz Exposes The Real Hazard Here
In a response message on X, Ripple’s Chief Technology Officer (CTO) described how this suit lacks the basis for jurisdiction: “The logic that the property was found in the state of NY is comically bad”, arguing that it would make no sense for a New York Court to takeover all of the allegedly abandoned Bitcoin (BTC) crypto wallets.
On the flipside, Ripple’s CTO explained what would happen if the court actually granted the plaintiffs a legal victory. In such a case, this could actually set a pretty dangerous precedent: granted that the two Wyoming companies & Noah Doe get a ruling in their favor, someone could move the digital assets on a United States-regulated crypto exchange with immediate freeze.
Even though the declaration is “legal nullity”, Ripple’s Schwartz also acknowledges that it’s not entirely inconceivable that a US court may find that due to the passage of time, the claim that the ruling is void was procedurally defaulted!”, in which case “they could wind up stealing people’s crypto”, sounding the alarm with one ask: “I really hope that somebody is taking this case seriously.”
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A lawsuit filed in New York is trying to claim ownership of thousands of dormant Bitcoin wallets (including some potentially linked to Satoshi Nakamoto). The plaintiff wants the court to declare over 3.7 million BTC as “abandoned property” so they can take legal ownership.
Schwartz responded publicly saying there are “many significant legal problems” with the case — especially around jurisdiction. He added: “I really hope somebody is taking this case seriously,” highlighting how dangerous or ridiculous the precedent could be if it moves forward.
If successful, this lawsuit could set a scary precedent — allowing people to go after old or inactive crypto wallets through the courts. It raises huge questions about wallet ownership, property rights, and what “abandoned” even means in crypto.
Schwartz is very skeptical. He pointed out major legal flaws, including lack of proper jurisdiction. Most legal experts see the case as weak and unlikely to succeed, but it’s still getting attention because of the massive amount of Bitcoin involved.
As Ripple’s Chief Cryptographer (and one of the original creators of the XRP Ledger), Schwartz is highly respected in crypto for his technical and legal insights. His comments often carry weight across the entire industry, not just XRP.
