UK bitcoin seizure case narrows victims' path to £3.8bn haul after High Court ruling

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UK bitcoin seizure High Court ruling

Highlights

High Court in London rules that Chinese law, not English law, governs claims over 61,000 bitcoin seized in the Zhimin Qian case.
Decision narrows victims' chances to reclaim the bitcoin, now worth about £3.8 billion, with significant implications for recovery versus UK Treasury benefit.
Further court hearings will review expert evidence under Chinese law, but claimants plan to appeal and final ownership remains undecided.

High Court backs Chinese law approach

As reported by Financial Times, the High Court in London rules on Monday that Chinese, rather than English, law should govern claims over 61,000 bitcoin seized by Metropolitan Police during an investigation into Zhimin Qian, a Chinese national jailed at Southwark Crown Court last year after fleeing to Britain.

The civil case turns on whether victims of the fraud can argue the bitcoin rightfully belongs to them or whether they rank only as creditors. English law had been viewed as more supportive of the victims' position, and their lawyers argued at a July hearing that English property rules should apply because the assets are held in the UK.

Mr Justice Mark Turner sides with the Crown Prosecution Service, saying the relevant damage, the transfer of money, the alleged misrepresentations and the resulting contractual relationships all occurred in China. He says the immediate economic consequences of the alleged wrongdoing were also suffered in China.

Turner also says the preliminary ruling does not decide who ultimately retains the bitcoin. Unless the judgment is overturned on appeal, the London court is set to hear expert evidence on Chinese law before determining the outcome of the case.

Implications for victims and the UK

Bitcoin has risen sharply in value since the seizure, reaching £62,384 per coin, and the holding is now worth about £3.8 billion. That increase has intensified the fight between victim groups seeking recovery and the UK Treasury, which could otherwise benefit from a substantial windfall.

One victim in China says the situation is infuriating because authorities have made a fortune from the money while offering only modest interest in return. Prosecutors have previously told the court that victims could instead be compensated through a redress scheme run from China.

The Crown Prosecution Service says in a statement that a further hearing will determine the application of the law and whether any victims can establish an interest in the bitcoin. Fieldfisher, the law firm representing the claimants, says it is pursuing an appeal against Turner's ruling and declines further comment.

Our earlier report on Africa Bitcoin Corporation focused on escalating governance turmoil at the JSE-listed bitcoin treasury firm after the interim CEO and three independent directors resigned amid pressure from majority shareholders. We noted that the departures left the company with just two directors and intensified scrutiny following regulatory action against former executives, with an upcoming shareholder meeting seen as pivotal for stabilising oversight.

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