Crypto conundrums

In what is surely a first for English law, the High Court in England and Wales recently approved service of pleadings via a so called non-fungible token or ‘NFT’.

In D’Aloia v Person Unknown & Others Mr Justice Trower took the unprecedented decision of granting service via this method owing to the otherwise opaque ownership structure of the defendants.

The application was made by a Mr Fabrizio D’Aloia, a British citizen who alleged that he had been duped into handing over millions of dollars’ worth of crypto currency by an online currency trading website “www.tda-finan.com”.

Mr D’Aloia had made various deposits between December 2021 and May 2022 into two named crypto wallets which were recorded as belonging to the platform associated with the website. He went on to make various trades but it was only when he tried to make withdrawals that his account was blocked leading him to believe he had been a victim of fraud.

The website appears to be run by a company in Hong Kong and is controlled by individuals currently unknown. Mr D’Aloia therefore requested that he be allowed to serve proceedings by way of NFT into the tda-finan wallets in respect of which he first made his transfers.

Recognising that this was indeed a ‘novel’ form of service, the judge nonetheless granted permission to do so on the basis that it was ultimately “likely to lead to a greater prospect of those who [were] behind the tda-finan website being put on notice of the … the commencement of proceedings”.

Briffa comment

Briffa have been at the forefront of this challenging and rapidly developing area of law since its inception: we are well placed to assist with any issues you may have in the crypto sphere, from negotiating NFT Agreements to resolving disputes in the event things go wrong. If you need any further information in this regard, please do feel free to get in touch with us via info@briffa.com.

Written by Tom Synott, Senior Associate