Hong Kong Court Declares Crypto as Property in Case Involving Defunct Gatecoin

04/20 01:09

According to Coindesk, a Hong Kong court has recognized crypto as property "capable of being held on trust" in a case involving shuttered crypto exchange Gatecoin, global law firm Hogan Lovells reported on Wednesday. Justice Linda Chan, who presided over the case, reportedly said Hong Kong, in line with other common law jurisdictions, defines "property" broadly "intended to have a wide meaning." There have been similar rulings in Mainland China, while the U.S. Internal Revenue Service treats crypto as property for tax purposes. A government-funded law commission in the U.K. found crypto can be classified as a new type of property under existing laws in England and Wales. In 2019, Hong Kong-based crypto exchange Gatecoin announced it will shut down and start liquidation following an attempt to recover disputed funds from a former payment services provider. Liquidators sought directions from the court on whether the crypto held by Gatecoin should be treated as property held on trust or "if no trust existed, the digital assets should be made available to the general body of creditors," according to the Hogan Lovells report. The exchange held up to 140 million Hong Kong dollars ($17.8 million) in crypto as of last October, the report said.
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