The recent release of a report by the UK Law Commission has significant implications for the ongoing lawsuit brought by Craig Wright against 12 Bitcoin core developers. The report challenges Wright’s central argument that the developers are responsible for the loss of 111,000 BTC to hackers. The Bitcoin Legal Defense Fund (BLDF) argues that the commission’s classification of fiduciary duty supports the developers’ defense.
In his lawsuit, Wright, the owner of Tulip Trading, claimed that the Bitcoin Core developers had a fiduciary duty towards him regarding the loss he suffered. Seeking a way to recover the allegedly stolen funds, Wright is also known for asserting that he is Satoshi Nakamoto, the pseudonymous creator of Bitcoin. However, the UK Law Commission’s report provides a definition of fiduciary duty that excludes the developers from any legal responsibility for Wright’s losses.
The report clarifies that fiduciary duty typically applies to specific categories such as agents, trustees, partners, company directors, and solicitors. The BLDF argues that the defendants do not fit into any of these categories mentioned by the Commission, stating that they were never entrusted with authority over the property or given discretionary decision-making power on behalf of another person. The BLDF further emphasizes that Bitcoin was designed to enable direct transactions between individuals without the need for third-party authority.
The outcome of the Tulip Trading lawsuit could have far-reaching implications for the liability of open-source developers concerning assets. The trial for this case is expected to take place in 2024. Jessica Jonas, the chief legal officer of the BLDF, highlighted during the Bitcoin 2023 conference the potential impact of the lawsuit on the open-source developer community, as the majority of software programs globally are open-sourced.
In addition to addressing fiduciary duty, the UK Law Commission report advocates for the creation of a new category of personal property to accommodate the unique characteristics of digital assets. This recommendation reflects the need for regulatory frameworks to adapt to the evolving landscape of cryptocurrencies and blockchain technology.
Overall, the report by the UK Law Commission reinforces the defense of Bitcoin core developers in the Craig Wright lawsuit, shedding light on the legal definition of fiduciary duty and affirming their lack of liability for the stolen BTC. The outcome of this case will likely shape legal precedents regarding the responsibility of open-source developers and the treatment of digital assets within the legal system.