The Old and the New: Equity Embraces the Cryptocurrency

Two recent decisions at opposite sides of the globe have shown how the common law courts are applying traditional concepts to new technology.

B2C2 Ltd v Quoine Pte Ltd

First, in B2C2 Ltd v Quoine Pte Ltd1, the Commercial Court of Singapore has held that a cryptocurrency is property capable of being held on trust.

In that case, the defendant operated a currency exchange platform (the “platform”) enabling third parties to trade virtual currencies for other virtual currencies or for fiat currencies. The plaintiff’s claim arose out of an incident whereby seven trades for the sale by the plaintiff of Ethereum for Bitcoin were effected by the platform at a rate approximately 250 times the going rate. When Quoine, became aware of the trades it cancelled them and the relevant debit and credit transactions were reversed.

B2C2 contended that Quoine had acted in breach of contract in unilaterally cancelling the trades; that it held the proceeds of B2C2’s account on trust for B2C2; and that the withdrawal of the Bitcoin which had been credited to the account as a result of the trades was in breach of trust.

The court ultimately held that there had been a breach of contract that was not void/voidable by reason of mistake. It then had to consider whether the cryptocurrency was property which could be held on trust for the plaintiff?

Was there a trust?

The parties agreed that there had to be three certainties for the creation of a trust, namely, certainty of subject matter, certainty of objects and certainty of intention.

In relation to certainty of subject matter, the parties were prepared to assume that cryptocurrencies could be treated as property that could be held on trust. The court agreed. Simon Thorley LJ made the point that cryptocurrencies are not legal tender in the sense of being a regulated currency issued by a government but do have the fundamental characteristic of intangible property as being an identifiable thing of value.

Moving on, he said that certainty of objects required that the intended beneficiaries of a trust had to be identifiable so that it was possible to ascertain those who had the standing to enforce the trustee’s duties under the trust. Here, the beneficiaries were identifiable from the individual accounts of each of the platform members.

The main dispute centred on certainty of intention to create a trust. The court pointed out that in ascertaining the requisite intention, it was not necessary for express words to that effect to be used. The court should have regard to the conduct of the alleged settlor, the words used in any relevant documents and all the surrounding circumstances.

In this case, the agreement regulating use of the platform contained no express words creating a trust. The necessary intention was thus to be determined from the document as a whole and from Quoine’s conduct when handling the assets. Here the assets were held separately as member’s assets rather than as part of Quoine’s trading assets. This was the decisive factor.  It was a clear indication that Quoine claimed no title to those assets and acknowledged that it was holding them to the order of the member who could demand withdrawal at any time. This was sufficiently clear evidence that Quoine intended to hold the assets on trust for the individual member. Accordingly, as Quoine had not been entitled to reverse the trades, the reversal and hence the unilateral removal of the Bitcoin from B2C2’s account was in breach of trust.

Trafalgar Developments Ltd v Mazepin

In the Irish case of Trafalgar Developments Ltd v Mazepin2the plaintiffs claimed that the defendants were co-conspirators in an alleged scheme intended to wrongfully divest the plaintiffs of the benefit of their shares in a Russian company. The plaintiffs obtained judgment in default of appearance against certain defendants and sought post-judgment worldwide Mareva-type relief against them. The property targeted by the order included cryptoassets. Barniville J granted the order as well as an order requiring those defendants to disclose on affidavit all wallets in respect of any cryptocurrency worldwide in which those defendants had a direct or indirect legal or beneficial interest. It is clear from the judgment that the court had no difficulty in including those assets within the ambit of the injunction and ancillary relief.


While there is rightly some debate across the common law world as to the ability of traditional legal and equitable concepts to adapt to emerging technology, these two judgments illustrate that where the courts consider it appropriate, they can and will provide a remedy to meet the exigencies of the case.

  1. [2019] SGHC(I) 03.
  2. [2019] IEHC 7.

This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.