University Of Oxford Asks Can Crypto Transactions Become Immutable But Not Irreparable?
Can Crypto Transactions Become Immutable But Not Irreparable?
The University of Oxford of Law has recently released a blog article in which it affirms that there, in fact, ways that people could potentially recover their funds by legal ways whenever they were hacked or stolen using cryptos.
Everybody knows that crypto transactions are simply immutable. As soon as you do them, you cannot undo them (unless in the case of some specific small altcoins). Because of this, people have to find new ways to recover the money whenever they need it.
The Need To Set A Precedent
The blog post cites the case that happened in Singapore when Copytrack sent 530 ETH by mistake to an investor. The case, titled Copytrack Ptd Ltd vs Wall, was filed in Canada, despite the company being based in Singapore.
According to the courts of Canada, the case began when Brian Wall invested the total sum of $780 CAD to buy tokens during Copytrack’s Initial Coin Offering (ICO). Wall should receive 530 CPY tokens for his investment, however, he actually received 530 ETH, which is a lot more money than that.
At the time of the mistake, that much ETH was worth almost half a million CAD. As soon as the exchange identified the error, it asked the investor to return. Obviously (or there would be no case at all), he simply decided not to give the money back.
After going to court, Wall eventually decided to give back the money but claimed later that he had been hacked and lost possession of the tokens. Probably a lie, but nothing could be done, right? Wrong. Copytrack received the legal right of taking back the ETH tokens from whoever held them at the time of their discovery.
Wall actually died during the process, so the case was complicated even more, but in any case, the legal precedent was set.
The Irreversible Aspect Of Cryptos
While companies like Mastercard and Visa offer easy measures to protect the customers, a system like this could never be implemented in the crypto world, as there is no chargeback technology and you need to actually make the transactions from the wallet.
Blockchains are made to be immutable, so it would be almost impossible for them to be unmade and would require approval from all the decentralized verifiers of the system, which makes it even harder.
However, as long you have two people with identities that can be known, the problem can actually be solved (unless one of them dies, of course).
You can easily track crypto transactions from one wallet to the other, so if you discover who is holding the tokens, it would not be too unexpected for the rightful owner of the money be able to recover it by charging the other person legally.
The person could, of course, simply affirm that it would not pay but then it would be liable to all the sanctions that people generally have when they do it. The system might not be perfect, but even with fiat transactions it is never simple if one of the sides simply refuses to pay even after having its assets frozen.