In the first case of this kind in Singapore, the crypto exchange Quoine is being sued by the major liquidity provider B2C2. The court case began today, November 21, reported by The Straits Times, a Singapore-based English-language daily newspaper.
The legal battle began because of an alleged reversal of crypto transactions back in 2017. B2C3 affirms that Quoine has reversed seven Bitcoin (BTC) to Ethereum (ETH) trades that were made in April 2017. Quoine affirms that the reversal was a technical glitch while the liquidity provider argued that the “decision” should not be taken without its consent.
The trades involved 3,085 BTC (around US$13.7 million even in the current bear market now).
B2C2 is upset because the company might lose a lot of money because of these traders and the company is not eager to bear the financial loss alone. They accused Quoine of choosing the most advantageous way for them to mitigate their own risks by reversing “irreversible” trades and deducting the proceeds from the account. However, this made B2C2 lose money.
Quoine states that as a result of liquidity problems, B2C2 was able to set up trades of 10 BTC for 1 ETH and that the exchange would have been a loss if B2C2 had its own way. Therefore, the company is complaining that these orders were abnormal and unfair because the price was absurd by market standards and the prices were 250 higher than usual. In order to defend its own assets and clients, Quione chose to halt the sales, leading to this dispute.
The trial is expected to end in about a week, according to The Straits Times. In other courts around the world, we are starting to see blockchain and crypto issues being addressed too.
In September, China determined that blockchain-based evidence was suitable for legal proceedings while also September, a New York federal judge ruled that U. S. securities laws are applicable in crypto cases.