Over the last decade, year over year, hackers have stolen billions of dollars in cryptocurrencies. Last month, another of the world’s largest cryptocurrency exchanges was hacked in what has been called the largest crypto heist in history. The exchange was Bybit, based in Dubai, and the hackers, which according to a public announcement by the FBI are linked to North Korea, ran away with $1.5 billion in Ethereum (ETH).
Unsurprisingly, crypto holders fear being swept up by the next hack and seek government safeguards and fortified technology. After all, unlike cash deposits or securities, digital assets held on an exchange are not afforded protections by the Federal Deposit Insurance Corporation or the Securities Investor Protection Corporation. And robust countermeasures are needed to offset the growing sophistication and tech of the fraudsters.
However, the issue of who owns digital assets – which comes to the forefront when they are stolen, lost or diminished – is a threshold matter that must be considered by any crypto investor that stores digital assets with a third-party platform. Below is a discussion on the factors courts have considered to resolve the ownership issue.
Continue reading: Crypto Ownership and Custodial Wallets: Owning Without Owning?