Bitcoin Forum
November 14, 2019, 07:27:43 AM *
News: 10th anniversary art contest
 
   Home   Help Search Login Register More  
Pages: [1]
  Print  
Author Topic: [2016-08-15]'Grumpy hold-outs' could sink Bitfinex recovery plan after BTC theft  (Read 189 times)
WishICanTurnBackTime
Full Member
***
Offline Offline

Activity: 238
Merit: 100


View Profile
August 15, 2016, 10:28:50 AM
 #1

Crypto-currency exchange Bitfinex's plan to impose losses on all its trading clients for the theft by hackers of $72 million in Bitcoin rests on two flawed pillars, according to lawyers.
The Hong Kong-based exchange said on Aug. 2 that hackers had stolen 119,756 bitcoins from some clients' accounts, the second-biggest such hack in dollar terms, and later said it would spread the losses across all its customers, whether or not they had been hacked or even held bitcoin.
It said customers would forfeit 36 percent of their holdings and be given "BFX tokens" instead that could be redeemed by the exchange or converted to shares in its parent company iFinex.
Both elements of the plan are open to legal challenge, lawyers said.
Imposing losses on customers who were not hacked appears to go against the company's terms of service, said Ryan Straus, a Fenwick & West lawyer who advises financial technology companies on regulation and co-authored the U.S. chapter of a book on bitcoin law.
The terms state "bitcoins in your multi-signature wallets belong to and are owned by you", which Straus said implied a special banking relationship with clients that the Bitfinex plan would breach.
"The depository ... is obligated to return, on demand, the same monetary objects deposited," he said, quoting a line from his book.

http://www.reuters.com/article/us-hongkong-bitfinex-idUSKCN10Q0DQ
1573716463
Hero Member
*
Offline Offline

Posts: 1573716463

View Profile Personal Message (Offline)

Ignore
1573716463
Reply with quote  #2

1573716463
Report to moderator
The Bitcoin Forum is turning 10 years old! Join the community in sharing and exploring the notable posts made over the years.
Kaneki
Sr. Member
****
Offline Offline

Activity: 252
Merit: 250



View Profile
August 15, 2016, 01:49:30 PM
 #2

redeemable by the exchange or convertible to shares in iFinex - places them somewhere between a bond and a security and makes it highly likely that issuing them and trading them would require licenses in the U.S. that Bitfinex doesn't have.
zby
Legendary
*
Offline Offline

Activity: 1592
Merit: 1001


View Profile
August 15, 2016, 04:29:09 PM
 #3

redeemable by the exchange or convertible to shares in iFinex - places them somewhere between a bond and a security and makes it highly likely that issuing them and trading them would require licenses in the U.S. that Bitfinex doesn't have.

That is why US residents cannot trade it.
Pages: [1]
  Print  
 
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!