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Russian Court Recognizes Cryptocurrency as Valuable Property

According to local news outlet RBC’s report, for the first time, Russian court has recognized cryptocurrency as valuable property. The Court of Appeal allowed to recover the bitcoins from the debtor, despite the fact that the legal basis for the implementation of this decision is still under development.

Prasanna Peshkar

Prasanna Peshkar

October 13, 2018 2:20 PM

Russian Court Recognizes Cryptocurrency as Valuable Property

According to RBC’s report, Russian court has recognized cryptocurrency as valuable property. The Court of Appeal allowed to recover the bitcoins from the debtor, despite the fact that the legal basis for the implementation of this decision is still under development.

In what is being seen as a landmark judgment, a Russian court has ‎ruled for a solicitor who requested that the judge incorporate the bitcoins held ‎by a bankrupt individual in the borrower’s liquidation domain. Russia currently has no legal framework for cryptocurrencies.

The case includes Russian native Ilya Tsarkov who filed bankruptcy in October a year ago. The court has ordered his cryptographic forms of money to be transferred to the trustee, Alexei Leonov. The private key of the crypto wallet which belongs to Tsarkov will be given to Leonov soon. As per Vedomosti, Tsarkov claims just about 0.2 bitcoin which is worth around US$1,885 at current market rates.

Alexei stated that with this ruling:

“The court indirectly recognized the cryptocurrency as property and recognized its value.”

The case was initially heard by the Moscow Arbitration Court in February, and in spite of the fact that the court ordered Tsarkov to uncover his digital currency property, they then decided that Mr. Tsarkov’s possessions couldn’t be exchanged to Leonov on the grounds that “the laws of the Russian Federation don’t recognize cryptocurrency as property.”

As reported by the local media., after this order, Alexei Leonov further said that

“The position of the European Court of Human Rights on the issue of property and a bankruptcy case in Japan, where a court permitted to sell the debtor’s cryptocurrency.The lower court should have taken into account modern economic realities and new information technologies…bad-faith parties could exploit the fact that cryptocurrencies were excluded from bankruptcy estates by converting their assets and thus rendering them inaccessible.” 

Rapsi, a Russian Legal Information Agency published the court’s explanation:

“Currently, Russian legislation does not provide definition of cryptocurrency and there are no requirements for its circulation. There is no way to tell if it is property, information or “surrogate”, the court notes, stating that it is impossible to regulate the relations involving cryptocurrency”

While the global status of cryptocurrency is not completely legal, this most recent decision is an intriguing advance towards more noteworthy elucidation of its status in Russian law.

 

Prasanna Peshkar
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Prasanna Peshkar

Prasanna Peshkar is a seasoned writer and analyst specializing in cryptocurrency and blockchain technology. With a focus on delivering insightful commentary and analysis, Prasanna serves as a writer and analyst at CryptoTicker, assisting readers in navigating the complexities of the cryptocurrency market.

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