Canadian Court Holds Bitcoin Loan Defaulter Responsible, Asks to Return $1.2 Million

Crypto acceptance is growing as courts acknowledge transactions made via the asset class, holding wrongdoers responsible.

The Supreme Court of British Columbia ruled in favor of a plaintiff who lent a large sum of bitcoin in 2021 and did not get repaid. The court ordered the defendant to return the borrowed funds—22 bitcoin—amounting to about $1.2 million by recent valuations.

The transaction occurred when the plaintiff, Hung Ngyuen, met the defendant, Daniel Tambosso, through a mutual friend. Over that meeting, Tambosso spoke of holding large amounts of bitcoin and being a target of cybercriminals. He mentioned that he would be acquiring security software to fortify his digital wallet against threats and that this software was created by none other than the Bitcoin network’s pseudonymous founder, Satoshi Nakamoto. Tambosso claimed this process occurred over various stages, with each requiring him to pay considerable amounts of bitcoin.

He asked Ngyuen to loan him 18 bitcoin for that, which he would repay in 48 hours. Sometime within those 48 hours, Tambosso asked for and received an additional four bitcoin. Ngyuen was made to believe Tambosso held over $5 billion in bitcoin in his digital wallet through screenshots and would be paid 1,750 bitcoin as compensation for him loaning the assets. However, the repayment never occurred.

The judge noted that contracts were involved, holding Tambosso responsible for repaying the funds despite the loan occurring via cryptocurrency. “This case involves an old-fashioned cause of action and remedy,” the judge said. He also added that it came with a “modern twist” due to the cryptocurrency element.

The Judge Ordered the Defendant to Pay Damages of Over $1.2 Million and Interest.

Despite numerous arguments from Tambosso about why he should not return the bitcoin, the judge ruled in favor of Nguyen. “Mr. Nguyen is awarded damages against Mr. Tambosso for $1,240,106.22,” he ordered. He also ordered that Nguyen receive interest for the lent amount from September 24, 2021, and his court-related expenses.

This conclusion represents the growing acceptance of crypto worldwide as judicial bodies now recognize the transactions. Not too long ago, a court in Dubai recognized salary payments in crypto.