Key takeaways:
- Singapore’s High Court declared cryptocurrency to be a type of “property” that can be held in trust.
- The choice might appear apparent but contains vital terms crucial for digital assets’ legal standing.
In a case between the Seychelles-based exchange Bybit and a contractor, Singapore’s High Court declared cryptocurrency to be a type of “property” that can be held in trust.
On July 25, Judge Philip Jeyaretnam of the High Court of Singapore decided that cryptocurrency constituted “property” that could be trusted. According to the judge, there is no distinction between cryptocurrencies, fiat money, or shells as long as all of these items, whether physical or not, share a value that is based on shared trust in them.Â
Jeyaretnam rendered his decision in a dispute brought by Bybit against Ho Kai Xin, a former employee. The employee allegedly transferred almost 4.2 million Tether from the cryptocurrency exchange to her personal accounts, according to Bybit. Jeyaretnam stated:
“Like any other thing in action, USDT is capable of being held on trust,”
Ho has asserted that a distant relative manages the relevant accounts, and the court has now mandated that she reimburse Bybit for the money.
The choice might appear apparent but contains vital terms crucial for digital assets’ legal standing. The stolen USDT and all cryptocurrencies, in general, are referred to by Jeyaretnam as property. The judge said despite their absence in person:
“We identify what is going on as a particular digital token, somewhat like how we give a name to a river even though the water contained within its banks is constantly changing.”
Jeyaretnam refutes the widespread belief that cryptocurrency has no “real” worth by pointing out that value is a determination made by a collection of human minds. Jeyaretnam categorizes cryptography as one of the “things in action.”
British common law refers to a particular class of property that can have personal rights asserted or enforced through legal action rather than through physical ownership.
The Monetary Authority of Singapore (MAS), which will enforce segregation and custody restrictions for digital payment tokens, published a consultation paper that the court referenced in his ruling. The judge argued that holding such digital assets in trust should be legally permitted if it is practical to identify and separate them.
In the judgment, it is noted that Order 22 of Singapore‘s Rules of Court 2021 specifies “movable property” as being cash, debt, money deposits, bonds, shares, or other securities, membership in clubs or societies, as well as cryptocurrencies or other digital currency.
