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A man seeking repayment for Bitcoin lost in the Mt Gox incident has seen his lawsuit dismissed in a Tokyo District Court, with the judge ruling that the gumblecash is "not subject to ownership" claims.
A resident of Kyoto, the plaintiff has stated that he had 458 Bitcoin, contentiously valued at about ¥31m (£160,000), which were stored with the exchange and subsequently lost, reported the Japan Times.
Earlier this month, the Mt Gox CEO, Mark Karpeles, was arrested as part of a police investigation into the exchange's collapse, which led to the loss of "hundreds of millions of dollars" worth of Bitcoin.
The French-born CEO allegedly inflated his personal account by manipulating virtual currency data, according to the Japan Times.
Karpeles denied criminal doings in a statement delivered by his lawyer, the BBC reported.
Judge Masumi Kurachi – who presided over the plaintiff's self-represented claim – stated that the Japanese Civil Code only envisaged proprietorship for tangible entities.
According to the Japan Times, the judge's position is that "it is evident Bitcoins do not possess the properties of tangible entities and acknowledged that they also do not offer exclusive control, because transactions between users are structured in such a way that calls for the involvement of a third party". ®
(Score: 4, Interesting) by MrGuy on Saturday August 08 2015, @03:43PM
Bitcoin is one example of the fact that ownership laws still don't contemplate the digital future well.
I'm going to set aside intellectual property for a minute, because copyright and patent laws (while not exactly up to speed) are a different kettle of fish from the ownership of property. I can buy, own, and sell a home whether or not I have copyright to the blueprint or someone else owns a patent covering the gas fireplace.
Bitcoins are a collection of 1's and 0's. They're agreed to be considered owned by a certain person (or, perhaps more accurately, by a certain private key) as recorded in the public blockchain ledger. There is very little law whether that concept of ownership is legally enforceable, and if so how (and on whom)? Is owning a bitcoin like owning money? Or like owning a valuable painting? Or is it like the balance on a credit card? All these analogies are imperfect, and it's not clear which (if any) legally apply in different jurisdictions.
For example - let's say someone takes control of your computer and trashes all the files on the hard drive, and are later caught. What do they need to compensate you for? Nothing, because you still have the computer, and the hard drive is still working? Do they need to compensate you for the paid software on the machine (e.g. getting the OS and all the licensed software re-installed, either buying new copies or the labor to re-install the copies)? Do they owe you compensation for the word documents of poetry you'd written or the photographs you took, and if so how much? And now, if your bitcoin private key was on that laptop, do they owe you compensation for the bitcoins that you still putatively own but can no longer access? Or should they be liable for the bitcoins only if they were transferred, and someone else got beneficial ownership of the bitcoins?
Take as an analogy the ownership of in-game currency in an MMORPG (say, gold in World of Warcraft). It undeniably has some equivalent real-world value (as evidenced by the number of gold sellers out there). If someone hacks your account and steals the gold your character owns, you've lost something that was of value that you owned - is this theft? Should the police and the courts enforce it? What about if they steal your items - do they owe you what they cost you? Current market value? Nominal vendor sale prices? Should the operator of an MMORPG be REQUIRED to restore the gold to you if you could prove it was stolen? And how would you prove it?
In both cases, should digital instruments be considered negotiable or non-negotiable?
A check is an example of a negotiable instrument - it's a private debt that can be transferred, but the chain of ownership matters. Say Alice pays Bob with a $20 check. Bob signs the check over to Carl to settle a $20 debt. Carl signs the $20 over to Danni to purchase something. Danni transfers it to Eddie. But later, it turns out that Alice never actually signed the check - Bob forged it. Every transaction based on the forged check should fail - Eddie has a worthless check, and so can demand money back from Danni, who can demand it back from Carl, who can demand it back from Bob, who's got some 'splainin to do.
Despite being serial numbered, cash (at least in the US) is considered non-negotiable - if I buy something from you for cash, the cash is yours going forward. It doesn't depend on how I obtained the cash. So, if Bob stole $20 out of Alice's wallet, and the same chain of transactions happens, Eddie is no longer stuck with something worthless. And Carl's payment to Danni is totally unaffected. Bob needs to compensate Alice for the theft, but nobody who handled the money since cares.
Given Bitcoin transactions (and, I'd assume, MMO transactions and a whole host of other "valuable digital things" transactions) have history associated with them, should they be considered negotiable or not? If Bitcoins are like cash, then no - if I stole a bitcoin, I can substitute another. If they're like checks, then everyone receiving the stolen coin is affected. It's probably obvious why currencies (including Bitcoins) would like to be non-negotiable, but it's not clear the legal framework exists for that.
(Score: 2) by maxwell demon on Saturday August 08 2015, @04:34PM
Forging a check is not equivalent to stealing money. If Bob pays Carl with forged money, Eddie also ends up with a worthless piece of paper.
The Tao of math: The numbers you can count are not the real numbers.
(Score: 2) by Justin Case on Saturday August 08 2015, @09:47PM
But if the government issues mountains of green things with nothing backing them, everyone ends up with worthless paper. I think that's why bitcoin.
(Score: 0) by Anonymous Coward on Sunday August 09 2015, @10:39PM
If it comes out of somebody else's bank account, it is absolutely equivalent to stealing money - the legitimate owner is deprived of it in the process, how could it not be theft?