Canadian Court Orders Repayment of $1.2 Million Bitcoin Loan

The Supreme Court of British Columbia has mandated a repayment of $1.2 million in a Bitcoin loan dispute, highlighting the increasing legal recognition of cryptocurrencies.

Details of the Dispute

The court instructed defendant Daniel Tambosso to return $1.2 million to plaintiff Hung Nguyen, thus concluding a contentious legal battle over a loan involving 22 Bitcoin (BTC) that Tambosso borrowed from Nguyen in September 2021.

Justice Fitzpatrick stated, “Mr. Nguyen is awarded damages against Mr. Tambosso for $1,240,106.22. Mr. Nguyen is also awarded court order interest on the above amount from September 24, 2021.”

Nguyen initially loaned 18 Bitcoin to Tambosso on September 21, 2021, after being introduced through a mutual associate, with an understanding that the loan would be repaid within 48 hours. Following this transfer, Tambosso requested an additional 7.5 Bitcoin, and Nguyen agreed to loan him another 4 BTC the next day.

The judge emphasized that, regardless of the success of Tambosso’s project, the terms outlined in the contracts required him to return the original 22 Bitcoin to Nguyen. The judge characterized the case as leveraging “an old-fashioned cause of action” but with “a modern twist” due to the cryptocurrency aspect.

Increasing Legal Trends Favoring Cryptocurrency

Recent rulings in favor of cryptocurrencies indicate a growing acceptance of digital assets within the legal framework.

• On August 30, Bitcoin mining firm Rhodium Enterprises, despite filing for bankruptcy, received court approval to secure a loan either in US dollars or Bitcoin.
• The United States Supreme Court, on June 23, 2023, ruled in favor of Coinbase, halting proceedings against the exchange in two California cases.
• On August 16, the Dubai Court of First Instance recognized crypto salary payments as valid under employment contracts, reversing a previous denial based on valuation issues.

Regulatory Oversight on Unlicensed Operators

While cryptocurrencies are gaining acceptance in various legal domains, authorities are still active in regulating the space to safeguard investors.

In a recent court ruling, a United States federal court rejected crypto exchange Kraken’s motion to dismiss a lawsuit filed by the Securities and Exchange Commission, which accuses Kraken of operating an unregistered securities exchange.

In Hong Kong, since June 1, operating an unlicensed virtual asset trading platform (VATP) has become a criminal offense. Several exchanges are currently processing licensing applications, while others have opted out.