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The High Court has ordered a number of crypto exchanges to disclose the personal data of some of their users after the fraud was exposed.
These hackers transferred millions of pounds in cryptocurrencies such as Bitcoin, Ripple and Ethereum.
The exchange, which was not named to deter fraudsters, worked with the Metropolitan Police’s cybercrime unit and then a crypto-tracing specialist to try to trace the assets.
However, to continue the investigation, the exchange needed more information, the request of which was granted by the High Court.
The six exchanges were therefore ordered to hand over the names, bank accounts and card details of some suspected fraudsters.
Vanessa Whitman, a partner at law firm CMS, said the case is important because it outlines the attitude of the English courts towards crypto fraud.
“Although there are still practical difficulties associated with recovering stolen crypto assets, the decision in this case demonstrates the continued willingness of English courts to use the tools at their disposal, and where necessary, offer solutions to help victims of fraud,” she said. said
The case comes after figures from Action Fraud, the UK government’s national reporting system for fraud and cyber-crime, showed that money lost to crypto fraud had risen by 32 percent in the past year.
Hinesh Shah, senior associate at Pinsent Masons, said that despite the recent fall in cryptocurrency prices, the association of cryptocurrencies continues to attract investors with huge losses in profits who lack the necessary expertise and experience to tell legitimate cryptocurrency investments from fraud.
There is also concern that scammers may actively target these inexperienced investors.
Shah added: “Given the large sums some crypto investors made during the boom, scams involving cryptocurrencies can be particularly potent for small investors who may be desperate to make a ‘quick buck’.”
Regulators and the government have yet to decide whether they should regulate crypto, and if so, how.
Some have argued that the sector should not be regulated, as it would further legitimize an industry that poses no threat to financial stability and is an inherently risky investment.
However, last month, the deputy governor of the Bank of England warned that crypto needs to be regulated to protect financial stability.
John Cunliffe, the Bank of England’s deputy governor for financial stability, said that the past year’s experience has shown that crypto is not a stable ecosystem.
Part of this is because its foundation is “completely unbacked instruments of extreme volatility” that can swing wildly in value, he said.
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