The last time we wrote about cryptocurrency, we were encouraged by signs that the courts of England & Wales were developing a sophisticated practice and knowledge base and recognising the practical considerations of dealing with cryptocurrencies.
We’ve been pleased to see that trend continue as the breadth and complexity of issues in the area grow. There also appears to be an increasing willingness from the courts to assist victims of crypto fraud.
We explore some of the key cases and legal developments in crypto asset disputes below.
Key Case Developments in Crypto Litigation
Tulip Trading Ltd v Bitcoin Association [2022]
In this case, Tulip Trading Ltd claimed ownership of a substantial amount of Bitcoin (valued at around $4 billion in April 2021) but lost access to it following a hack. To recover the assets, the company brought proceedings against several software developers, arguing that they owed Tulip a fiduciary duty in their role maintaining the relevant blockchain protocols.
Tulip argued that the developers had a duty to take reasonable steps to safeguard cryptoassets and implement software updates that would restore control to the rightful owner. The Court of Appeal found that Tulip’s case raised a serious issue to be tried and had a real (not merely fanciful) prospect of success, allowing the case to proceed to trial.
While the ruling does not decide whether fiduciary duties apply in this context, it marks the first time an English court has acknowledged the possibility that software developers might owe such duties in decentralised networks. The outcome at trial could have significant implications for crypto governance.
Bitcoin as Recognised Property
The Court of Appeal in Tulip also considered whether Bitcoin qualifies as “property” under English law. Applying the four-part test from National Provincial Bank v Ainsworth, the court concluded that cryptoassets such as Bitcoin:
- Are definable
- Are identifiable by third parties
- Can be assumed by third parties
- Have a degree of permanence
The court also highlighted that Bitcoin is “rivalrous”—ownership by one party excludes ownership by another, much like cash. This confirms that cryptoassets are capable of being treated as property, paving the way for proprietary claims such as freezing orders and tracing remedies in crypto disputes.
Security for Costs Cannot Be in Crypto
In a separate High Court case, a claimant’s attempt to provide Bitcoin (either Satoshi Vision or Core) as security for costs was rejected. The court held that crypto’s volatility posed a risk to the defendant and fell short of the standard required for court security, such as cash payments or guarantees.
This judgment illustrates the courts’ cautious stance: while they now recognise cryptoassets as property, they remain reluctant to accept them in procedural contexts where predictability and financial stability are paramount.
Emerging Procedural Adaptations
Alternative Service Methods
Given the decentralised and pseudonymous nature of many crypto scams, the courts have shown increasing flexibility in service methods. In D’Aloia v Persons Unknown and Boonyaem v Persons Unknown, claimants were permitted to serve proceedings via WhatsApp, Facebook Messenger, shared data rooms, and non-fungible tokens (NFTs) airdropped into wallets.
These decisions reflect a pragmatic approach to justice, adapting traditional rules to meet the challenges posed by modern technologies.
Summary Judgments Against Unknowns
In Mooij v Persons Unknown [2024], the court granted summary judgment against unidentifiable fraudsters who had been properly served. This represents a departure from Boonyaem, where the court declined to issue summary judgment due to insufficient identification of the defendants.
The decision in Mooij demonstrates a more flexible approach, showing that as long as the service is valid, relief may be granted, even against anonymous defendants.
Caution in Injunctive Relief
Injunctions against crypto exchanges remain available in fraud cases, particularly where claimants argue that the exchange received traceable proceeds as a constructive trustee. However, Piroozzadeh v Persons Unknown [2023] illustrates the importance of fairness in without-notice hearings. The court discharged an interim injunction after concluding the claimant had not fairly presented the defendant’s position.
This case underscores the ongoing duty of full and frank disclosure, even in urgent or high-value claims.
Regulatory and Legislative Context
Law Commission Recommendations
In response to the growing use of digital assets, the UK Government commissioned the Law Commission to examine whether existing laws adequately accommodate cryptoassets. The Commission’s final report was published in June 2023, followed by a supplemental report and draft Digital Assets Bill in July 2024.
The Commission recommends a three-part approach:
- Prioritise common law development for flexibility
- Introduce targeted statutory reform where required
- Provide industry-led guidance to aid consistency and clarity
The Commission also proposes recognising a third, boundary-less category of personal property, designed specifically for rivalrous digital assets that exist independently of legal or physical systems.
HM Treasury Proposals
In October 2023, HM Treasury announced proposals to regulate core cryptoasset activities. In November 2024, the Government confirmed its intention to introduce a new regulatory framework.
On 29 April 2025, the draft Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025 was published alongside an explanatory policy note. Key proposals include:
- Regulated roles for crypto exchanges and stablecoin issuers
- A dedicated market abuse regime
- Rules for custody and promotional activities
The consultation remains open for technical comment until 23 May 2025. These reforms are expected to significantly reshape the regulatory landscape for UK crypto markets.
Why Work with Ignition Law?
We are more than legal advisors, we’re entrepreneurial partners who understand the pace, pressures and possibilities of the crypto space. Our team has advised on everything from crypto asset tracing and proprietary injunctions to smart contract fallouts and disputes arising from token launches and blockchain integrations. We are often involved at an early stage, helping clients take preventative steps, or stepping in fast when things go wrong.
Whether it’s a complex technical dispute or a cross-border asset recovery issue, we bring sharp legal insight and commercial pragmatism.
As a B Corp-certified, award-nominated firm, we combine regulatory understanding with real-world experience across tech, finance and innovation. It’s this blend of legal expertise and entrepreneurial instinct that helps our clients resolve issues with speed, clarity and confidence.
Contact Ignition Law for Strategic Crypto Support
We’ve helped clients recover stolen assets, resolve crypto disputes, and secure urgent court orders. If you’re facing a crypto-related challenge and need fast, pragmatic legal support, get in touch with us today.
