LMN v Bitflyer Holdings Inc & Ors

Facts

The claimant, referred to as LMN, is a company incorporated in England and Wales which operates a cryptocurrency exchange. Its case is that it does not hold customers' cryptocurrency on trust but holds it in its own name, owing a personal obligation analogous to that of a bank. Some two years before the application, hackers obtained access to its systems and transferred millions of dollars-worth of cryptocurrency — Bitcoin, Ripple, Tether, Ethereum, ZCash and Ethereum Classic — from its 'Hot Wallets'. The claimant approached the FCA, the National Crime Agency and the Metropolitan Police, working with the Cyber Crime Unit, which after about three months said it could offer no further assistance and suggested civil proceedings. The claimant instructed solicitors and an expert, Pamela Clegg of CipherTrace, who traced transactions across the relevant blockchains and identified 26 recipient 'exchange addresses' holding Bitcoin or Bitcoin Cash across exchanges operated by the defendants or associated companies, beyond which the trail could not be followed because crediting to customers occurs off-chain. The claimant issued a Part 8 claim seeking information orders against six exchange 'topcos', applying for permission to serve out and by alternative means at a without-notice hearing on 28 October 2022, followed by an on-notice hearing on 11 November 2022.