Court Ruling on Bitcoin Ownership
- U.S. appeals court rules against Bitcoin claimant.
- Bitcoin worth $345M declared irrecoverable.
- Precedent set for digital asset custodianship.
A U.S. federal appeals court ruled the FBI cannot be blamed for wiping a hard drive allegedly containing $345 million in Bitcoin during a legal dispute involving Michael Prime.
The decision highlights challenges in claiming lost digital assets, influencing investor sentiment around cryptocurrency security and the irreversible nature of digital asset loss.
A U.S. federal appeals court ruled the FBI can’t be blamed for wiping a hard drive allegedly containing $345 million in Bitcoin, closing a lawsuit by convicted identity thief Michael Prime. Court considered ownership claim insufficient.
Michael Prime, convicted of identity theft in 2019, claimed the hard drive held ~3,443 BTC. Initially declared modest BTC holdings during court disclosures, later making larger claims post-release, all dismissed by the court.
Bitcoin valued at approximately $345 million, if ever present, is declared irrecoverable, adding to the global count of lost Bitcoin. Increased caution advised among crypto holders regarding digital asset custodianship.
Courts highlighted the essentiality of timely ownership assertion, referencing market data showing Bitcoin’s value during 2019 disclosures exceeded $10,000, contradicting past asset claims by Prime.
The ruling emphasizes the need for credible evidence and prompt ownership claims in digital asset disputes. Court decision aligns with historical cases of lost or destroyed crypto assets where claimants failed to prove ownership.
This case sets a precedent for future crypto custodianship disputes, urging more secure practices in key management. Similar events, like James Howells’ lost Bitcoin, underscore the permanent financial implications of asset mismanagement.
Glassnode, Blockchain Analytics Firm – “Millions of Bitcoin are irretrievable due to lost keys—a statistic now including this case”.
