Cryptocurrency Recognized as Property by Singapore High Court
Judge Philip Jeyaretnam of the High Court of Singapore made a significant ruling on July 25, affirming cryptocurrency as property that can be held on trust. The Judge emphasized that there is no substantial difference between cryptocurrencies, fiat money, or shells as long as they possess value, which is created through mutual faith in their worth.
The ByBit Case: A Landmark Ruling
The ruling was handed down in a case brought by ByBit against its former employee, Ho Kai Xin. ByBit alleged that the employee transferred approximately 4.2 million USDT from the crypto exchange to her private accounts. Consequently, the court ordered Ho, who accused a non-present cousin of controlling the relevant accounts, to return all the funds to ByBit.
Juridical Implications for Digital Assets
While the decision may appear obvious, it contains essential formulations with implications for the juridical status of digital assets. Judge Jeyaretnam categorizes stolen USDT and cryptocurrencies in general as property. Despite their lack of physical presence, the Judge likens them to naming a river, acknowledging that the water within its banks is constantly changing.
He rebuts the common suspicion that cryptocurrencies lack “real” value, reminding everyone that value is subjective and determined by an aggregate of human minds. Furthermore, Jeyaretnam classifies cryptocurrencies as “things in action,” a concept in British common law that refers to a type of property where personal rights can be claimed or enforced through legal action rather than physical possession.
Importance of the Consultation Paper by Monetary Authority of Singapore (MAS)
In his decision, Judge Jeyaretnam cites the consultation paper issued by the Monetary Authority of Singapore (MAS). This paper outlines plans to implement segregation and custody requirements for digital payment tokens. By identifying and segregating digital assets, the Judge notes that holding them on trust should be legally feasible.
Order 22 and Singapore’s Rules of Court 2021
The decision also references Order 22 of Singapore’s Rules of Court 2021, which defines “movable property” to include various items such as cash, debt, deposits of money, bonds, shares, other securities, membership in clubs or societies, and cryptocurrency or other digital currency.
Nonfungible Tokens (NFT) and the Precedent Set by the High Court of Justice in London
In May 2022, the High Court of Justice in London ruled that nonfungible tokens (NFTs) represent “private property.” Experts hailed this decision as a great precedent for individuals investing in NFTs, as it offers hope that British courts will protect their property rights.
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