Attorney Ian R. Cohen has filed a new lawsuit opposing efforts to revive a lawsuit seeking to control nearly 3.8 million bitcoins worth an estimated $238 billion, including wallets linked to bitcoin creator Satoshi Nakamoto.
summary
- Ian Cohen opposed efforts to revive a lawsuit targeting 39,069 Bitcoin wallets containing an estimated $238 billion.
- Dormant, self-held Bitcoin is not considered abandoned property under New York law, Cohen says.
- Galaxy researchers found recent activity in dozens of targeted wallets, challenging claims that the coins had been abandoned.
According to a June 20
The lawsuit was brought by anonymous plaintiffs identified as ABC Company, XYZ Company, and Noah Doe, who argue that the wallets should be treated as abandoned property under New York law.
Earlier this month, New York Judge Kathy King granted a stay after Cohen asked for permission to participate in the case as amicus counsel. A hearing on the amicus curiae request is scheduled for July 14.
Cohen said in his latest files that the court issued the stay decision after reviewing the matter and it was not granted based on his request. According to the filing, the court exercised its authority under New York procedural law when it halted the proceedings.
Dormant portfolios are not considered abandoned property, Cohen says
The crux of the dispute lies in the plaintiffs’ claim that long-inactive Bitcoin wallets can be classified as abandoned assets and transferred through a court order. Court documents previously cited by crypto.news Show The plaintiffs assert that the original owners no longer have access to the funds due to an alleged technical glitch.
Among the addresses listed in the lawsuit are wallets linked to Satoshi Nakamoto and a “1Feex” address, which blockchain researchers and cryptocurrency investigators have linked to bitcoin stolen during the Mount Gox hack.
Cohen has repeatedly challenged the legal basis of the case. In previous statements, he said that New York’s lost property laws do not apply to self-custodial Bitcoin, that inactivity alone does not prove abandonment, and that private keys fall outside the jurisdiction of New York courts.
His latest filing also calls into question the practicality of the lawsuit. According to Cohen, the defendants are not identifiable individuals but own 39,069 pseudonymized Bitcoin addresses, making it unlikely that aggrieved parties will appear in court to defend their interests.
The filing argues that lifting the stay could allow the plaintiffs to secure a default judgment against wallet addresses without meaningful opposition, potentially affecting property rights associated with billions of dollars in bitcoin.
Recent blockchain activity challenges abandonment claims
Elsewhere in the filing, Cohen challenged the factual basis of the abandonment argument by pointing to evidence suggesting that some of the targeted wallets were recently active on-chain.
According to the filing, the same complaint identified addresses that recorded outgoing transactions, suggesting that someone with access to the associated private keys had moved the funds. Cohen cited these transactions as evidence that at least some wallet owners are still able to control their bitcoins.
Galaxy researchers came to a similar conclusion. Thorne said Galaxy identified 52 named addresses that collectively transferred 34,335 bitcoins, while 29 of those addresses transferred 12,302 bitcoins after receiving notice of the lawsuit.
Criticism of the issue has also emerged elsewhere in the cryptocurrency industry. Last month, David Schwartz, Ripple’s chief technology officer emeritus, questioned how a New York court could assert authority over bitcoin wallets whose owners are unknown and spread across a decentralized network.
According to Schwartz, the lawsuit’s legal argument was one of its most serious weaknesses, and he warned that the legal theory could ultimately lead to people losing control of their crypto assets.
The debate even led to comparisons to future discussions about dormant Bitcoin collectibles. Recently, Binance founder Changpeng Zhao Suggested Wallets linked to inactive owners, including those believed to belong to Satoshi, could be frozen one day after the transition to quantum-resistant crypto if their owners fail to move funds within a specified migration period.
Any such change would require community consensus and would not be decided by a single individual, Zhao said.
