BitGrail saga epilogue: Corrupt exchange owner personally liable for the funds lost, Nano holders victorious
Nearly one year after Nano suffered massive catastrophe as cryptocurrency exchange that held most of NANO coins on their servers, Bitgrail got hacked. Bitgrail announced that the exchange had lost 17 million NANO (approximately $ 170 million).
The legal battle was broke out immediately and a year has passed by before we saw an Italian Bankruptcy Court and a court-appointed technical expert conclusion that Mr. Firano (“The Bomber” as Mr. Firano called himself on social media) was at fault for the loss and is required to return as much of the assets to his customers as possible. The ruling is a landmark decision that sets an important precedent for the protection of cryptocurrency users worldwide.
As the official account of Bitgrail victims reports on Medium, the court has ruled that Bitgrail’s remaining funds and Mr.Fiano’s personal assets can be seized as well which has already been done by Italian authorities.
“In its decision, made public on January 21, 2019, the Court found that the NANO reported lost by Mr. Firano on February 9, 2018, had actually been removed from the exchange months earlier, between July 2017 and December 2017.
The Court criticized Mr. Firano for not immediately taking steps to account for the losses. By waiting to make the shortfall public, Mr. Firano caused the public to suffer substantially larger losses. In July 2017, 2.5 million NANO was valued at approximately $250,000 (1/100th of the value it had in February 2018 when Mr. Firano went public).
As for the mechanics of the loss, the Court concluded that the exchange had failed to implement any meaningful safeguards to ensure the “idempotency” of NANO withdrawals from the Bitgrail exchange. An idempotent action is an operation that may only be performed once and if performed again will yield the same result.”
Claiming back your funds
As far as claiming back your funds, one of the users that submitted the story to Reddit advises following:
“I don’t have details myself but I did check a little Italian law last week. Process is much like UK law in this regard. You simply need to ask the Administrators for a blank claim form to fill in, and make your claim with as much evidence as you have – preferably transaction and balance screenshots from BitGrail.”
This “happy ending” to the Bitgrail saga is seen as first major legal victory for crypto users as the nascent technology is yet to establish its reputation and precedents within existing legal frameworks. It is also a repellent for all potential scammers and incompetent teams that saw running crypto exchanges as lucrative opportunity for easy money and non-existent accountability.
