What to Know:
- Indian court recognizes cryptocurrency as property capable of being held in trust.
- The ruling grants relief to a WazirX user whose XRP funds were frozen after a hack.
- This decision could influence how Indian courts handle user claims against foreign crypto exchanges.
A recent ruling by the Madras High Court in India has significant implications for cryptocurrency regulation and user rights, particularly concerning XRP holdings. The court recognized cryptocurrency as property that can be held in trust, providing relief to a WazirX user whose XRP funds were frozen following the exchange’s hack in 2024. This decision could set a precedent for future legal battles involving crypto assets and exchanges operating under foreign jurisdictions.
The court order directs Zanmai Labs, the Indian operator of WazirX, to provide a bank guarantee of approximately $11,500, equivalent to the user’s 3,532 XRP. This move protects the user’s assets pending arbitration, affirming that cryptocurrency is a property capable of being possessed and held in trust.
WazirX, once a dominant crypto exchange in India, suspended withdrawals after a $230 million hack in 2024. The company pursued restructuring in Singapore, offering “recovery tokens” to users, but the Madras ruling indicates Indian users may seek legal protection domestically, even when the company’s legal base is abroad.
For Indian users awaiting tokens from the 2024 WazirX hack, the Madras decision is a notable victory. While it doesn’t immediately restore funds, it establishes the principle that crypto assets belong to the user, not the exchange, which could shape future legal outcomes.
This ruling underscores the evolving legal landscape surrounding crypto assets in India. As discussions around Bitcoin ETFs and broader crypto regulations continue globally, this decision highlights the importance of protecting user rights and defining the legal status of cryptocurrencies like XRP.
Source: Original article
