In what could represent a landmark legal development for the crypto industry, US law firm Holland & Knight has served a defendant a pre-trial temporary injunction as a non-fungible token (NFT), acting in a legal case involving its client, crypto exchange LCX.
For the “first time in history”, “a temporary restraining order (TRO) to a defendant had been served via NFT,” according to the exchange.
Per the exchange,
“This innovative method of serving an anonymous defendant was approved by the New York Supreme Court and is an example of how innovation can provide legitimacy and transparency to a market that some believe is ungovernable.”
Similarly, Monty Metzger, CEO and Founder of LCX, tweeted that the court order “marks a historic milestone for the blockchain and crypto industry, as a sign of maturity and new transparency,”
In a statement, Holland & Knight said that the NFT subpoena was created and airdropped to the defendant by the law firm’s asset recovery team. They called it a “service token” or “service NFT.”
The on-chain process, said LCX, can be found on the Ethereum (ETH) blockchain.
The legal case involves a hacking attack on the exchange that took place in January. LCX said in a statement that the theft wiped close to USD 8m worth of crypto, but about 60% of the stolen funds have been frozen. The attack targeted one of the exchange’s hot wallets.
“All other LCX hot wallets and confidential customer data had not been affected and had not been involved in this security incident,” according to the statement.
Law enforcement agencies from the US, Liechtenstein, Ireland, and Spain, which participated in an international investigation, tracked the funds laundered through the Tornado Cash crypto mixer and identified the involved hacker wallets.
Some ETH 500 were frozen under a Liechtenstein court order served by law enforcement in Ireland to Coinbase Europe, and a further USDC 1.3m are frozen by Centre Consortium based on a US court order obtained from the Supreme Court of New York, LCX said.
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Learn more:
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– ‘NFTs May Be New, but This Criminal Scheme Isn’t’: Ex-OpenSea Head Arrested for NFT Insider Trading
– USA Real Estate Firm Puts New York Building for Sale as NFT
– Report on Lightning Network-Powered DeFi and NFTs Dismissed Even by Bitcoin Advocates
– NFT Ticketing
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