Attorney Ian R. Cohen has filed a new counter-claim to renew the lawsuit seeking control of nearly 3.8 million Bitcoins worth $238 billion, including wallets linked to Bitcoin creator Satoshi Nakamoto.
Summary
- Ian Cohen has opposed efforts to revive the lawsuit against 39,069 Bitcoin wallets holding an estimated $238 billion.
- Cohen argues that dormant Bitcoin does not qualify as abandoned property under New York law.
- Galaxy researchers have discovered recent activity on multiple target wallets, challenging claims that the coins have been abandoned.
According to the June 20 X thread sent by Galaxy Digital head of research Alex Thorn, Cohen’s filing on June 19 pushes back against the efforts of plaintiffs’ lawyer David Lin to overturn the court’s decision to stay in the New York case involving 39,069 Bitcoin wallet addresses.
The lawsuit was brought by anonymous plaintiffs identified as ABC Company, XYZ Company, and Noah Doe, who claim the bags should be considered abandoned property under New York law.
Earlier this month, New York Judge Kathy King granted a stay after Cohen requested permission to participate in the case as an amicus attorney. A hearing related to the amicus brief is scheduled for July 14.
In his latest letter, Cohen stated that this decision was issued by the court itself after reviewing the matter and it was not accepted according to his request. According to the documents, the court exercised its authority under New York procedural law when it halted the proceedings.
Cohen says sleeping bags don’t qualify as trash
At the heart of the dispute is the plaintiffs’ claim that long-dormant Bitcoin wallets can be classified as abandoned assets and transferred by court order. Court documents previously reported by crypto.news indicated that the plaintiffs are arguing that the original owners were unable to access the funds due to an alleged technical error.
Among the addresses listed in the indictment are wallets associated with Satoshi Nakamoto and the address “1Feex”, which blockchain researchers and crypto investigators have linked to Bitcoin stolen during the breach of Mt. Gox.
Cohen has repeatedly challenged the legal basis for the case. In previous statements, he asserted that New York’s lost property laws do not apply to Bitcoin custody, that inactivity alone does not constitute abandonment, and that private keys fall outside New York courts.
His latest filing also contradicts the effectiveness of the case. According to Cohen, the defendants are not identified individuals but 39,069 anonymous Bitcoin addresses, making it impossible for the parties to appear in court to defend their claims.
The filing argues that lifting the stay would allow plaintiffs to obtain default judgments against wallet addresses without reasonable objection, potentially impacting property rights tied to billions of dollars in Bitcoin.
Recent blockchain work challenges claims of abandonment
Elsewhere in the filing, Cohen challenged the factual basis of the dumping argument by pointing to evidence that some of the targeted wallets were recently active on-chain.
According to the filing, the complaint itself identified addresses that recorded outgoing transactions, indicating that someone with access to the associated private keys moved the funds. Cohen cited that transaction as proof that at least some wallet owners remain in control of their Bitcoin.
Galaxy researchers reached the same conclusion. Thorn said Galaxy identified 52 jointly named addresses that transferred 34,335 BTC, while 29 of those addresses transferred 12,302 BTC after receiving the indictment.
Criticism of the case has come from elsewhere in the crypto industry. Last month, Ripple CTO Emeritus David Schwartz asked how a New York court could assert jurisdiction over Bitcoin wallets whose owners are anonymous and scattered across the state’s network.
According to Schwartz, the argument of the legal case was one of the biggest weaknesses, and he warned that the legal theory could eventually lead to people losing control of their crypto assets.
The debate has even drawn comparisons to future discussions about Bitcoin’s dormant holdings. Recently, Binance co-founder Changpeng Zhao suggested that wallets linked to inactive owners, including those believed to be Satoshi, could one day be frozen after switching to cryptographic encryption that would resist value if their owners fail to transfer funds within a set migration period.
Zhao said any such change would require public consensus and would not be decided by one person.
