Singapore High Court on Cryptocurrency | Realizes Crypto as Personal Property

In a landmark ruling on July 25, 2023, the High Court of Singapore declared cryptocurrency as personal property in a case involving Bybit and a former employee. This is a significant development for the cryptocurrency industry, as it provides legal certainty for holders of digital assets and could help to boost adoption in the country. In this article we will see What was the hearing about, What did the Judge say and How this ruling is beneficial for crypto adoption.

Bybit VS Ho Kai Xin

The ruling was made in a case brought by Bybit against its former employee, Ho Kai Xin. Bybit alleged that Ho had transferred 4.2 million Tether (USDT) tokens from the crypto exchange to her private accounts. The court has now ordered Ho, who has accused a non-present cousin of controlling the relevant accounts, to return the money to Bybit.

“My conclusion is therefore that the holder of a crypto asset has in principle an incorporeal right of property recognizable by the common law as a thing in action and so enforceable in court.” – Judge Jeyaretnam

Singapore High Court’s Verdict: Cryptocurrency as Personal Property

Singapore High Court on Cryptocurrency
Singapore High Court on Cryptocurrency

Judge Jeyaretnam’s ruling shed light on the concept of digital tokens and their resemblance to tangible assets, such as fiat money and shells. He emphasized that despite the lack of physical presence, cryptocurrencies possess value due to the collective belief in their worth, much like a river has a name even though the water within it constantly changes. This perspective effectively dispels the common misconception that cryptocurrencies lack “real” value, highlighting that value is, in fact, a subjective judgment shared by the collective minds of individuals.

In the case of Bybit vs. Ho Kai Xin, the judge classified USDT, along with other cryptocurrencies, as property. This classification aligned with the notion of “things in action” under British common law, indicating that they are subject to personal rights and legal enforcement, rather than physical possession.

Cryptocurrency and “Things in Action”

By acknowledging cryptocurrency as a form of property and categorizing it under “things in action,” the High Court effectively granted it legal recognition and protection. The ruling relies on the consultation paper issued by the Monetary Authority of Singapore (MAS), which outlines segregation and custody requirements for digital payment tokens. The judge argued that if these digital assets can be identified and segregated in practice, holding them in trust should be legally permissible.

Strengthening Cryptocurrency’s Legal Framework

By incorporating “cryptocurrency or other digital currency” within the definition of “movable property” under Order 22 of Singapore’s Rules of Court 2021, the High Court has provided a robust legal foundation for cryptocurrencies. This development offers investors and users increased confidence and security, bolstering Singapore’s position as a hub for blockchain innovation and investment.

A Boost for the Crypto Community

The High Court’s landmark ruling represents a significant win for the entire cryptocurrency community. With official legal recognition, digital assets gain a new level of legitimacy, fostering innovation and adoption in Singapore’s financial landscape.

Here are some specific examples of how the ruling will impact the cryptocurrency community:

  • It will make it easier for businesses to accept cryptocurrencies as payment. Businesses will now be more confident that their cryptocurrency holdings are protected by law, which will make them more likely to accept cryptocurrencies as payment.
  • It will make it easier for people to invest in cryptocurrencies. Investors will now have greater confidence that their cryptocurrency investments are protected by law, which will make them more likely to invest in cryptocurrencies.
  • It will attract more businesses and entrepreneurs to Singapore. Singapore will now be seen as a more favorable jurisdiction for the cryptocurrency industry, which will attract more businesses and entrepreneurs to the country.

Conclusion

In conclusion, the Singapore High Court’s ruling on cryptocurrency as personal property marks a pivotal moment for the crypto industry. By acknowledging digital assets’ legal standing and equating them with fiat money and shells, the court has solidified the future of cryptocurrencies in Singapore. This landmark decision provides investors and users with increased confidence and security, propelling the country into the forefront of blockchain innovation. As Singapore paves the way for the seamless integration of cryptocurrencies into its legal framework, the rest of the world is sure to take notice of this trailblazing development. The future of finance has arrived, and it’s firmly rooted in the world of cryptocurrencies.

The ruling is likely to have a number of positive implications for the cryptocurrency industry. It could make it easier for businesses to accept cryptocurrencies as payment, and it could make it easier for people to invest in cryptocurrencies.The ruling is also likely to attract more businesses and entrepreneurs to Singapore, as the country will now be seen as a more favorable jurisdiction for the cryptocurrency industry.

I hope this article is helpful. Please let me know if you have any other questions.

Also read :

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