Abandoned bitcoins
Is it possible to recover abandoned bitcoins through the courts?
Из выпуска мониторинга No. 5 (29), May 2026 · выпуск целиком, PDF · на сайте Института Гайдара
In May 2026, an anonym using the pseudonym Noah Doe and two Wyoming companies (ABC Company and XYZ Company) filed a lawsuit in New York State Supreme Court seeking ownership of 39.069 inactive Bitcoin addresses. Plaintiffs claimed that, using the algorithm they developed, they identified addresses that had not been used for more than 5 years and therefore, in their opinion, could be considered abandoned. They therefore asked the court to recognize their ownership of these addresses and the bitcoins that are located there. Under New York's Personal Property Law, title to lost property valued at less than $10 may be transferred to the finder if the finder has made a one-year effort to locate the owner.
As evidence, the plaintiff indicated that he handed over flash drives containing lists of found addresses to the police and notified the owners via blockchain messages. However, an independent expert hired by the plaintiff estimated the value of each address at less than $10, explaining that the plaintiff does not have access to the assets, that restoring the value is associated with high challenges, and that obtaining the value through such restoration is not guaranteed, although in fact, the addresses may contain bitcoins worth a larger amount.
Thus, the plaintiff plans to acquire ownership only of the public addresses that are visible on the blockchain rather than of the bitcoins as such, and allow, for example, receiving transfers to such an address, but do not allow withdrawing cryptocurrency from such an address (since this requires a private key). Therefore, it is debatable whether a public address can be considered as found property if access to and disposal of bitcoins depends on availability of a public address as well as a private key.
New York has another law, the Unclaimed Property Act, which already includes provisions for unclaimed virtual currency: cryptocurrency may become state property if such cryptocurrency is held by an organization that operates in virtual currency (such as an exchange) and remains unclaimed for 5 years. However, this law is not entirely appropriate for the situation under consideration, since it regulates virtual currency held by an intermediary (for example, an exchange), while the lawsuit concern addresses without any intermediary at all.
Another legal question concerns whether it is possible to have separate ownership rights to a public address and a private key. And does ownership of a public address automatically mean ownership of a cryptocurrency that can only be used with the private key? Today, the
1 Abandoned or lost property is the one that has been left by its owner and is then found by another person. legislation of countries does not directly answer this question. In Russian law, digital currency is recognized as a set of electronic data (digital code or designation) that are contained in an information system and can be accepted as a means of payment or investment.
Therefore, a public address or a private key can hardly be considered property on their own.
2 Federal Law of 31.07.2020 No. 259-FZ.
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If the court upholds the claim, long absence of transactions with the crypto asset can be used as an What is argument in favor of its abandonment, although in practice the owner can simply hold the cryptocurrency and wait for its value to rise. next? However, without a private key, the plaintiff will still not be able to transfer the bitcoins, but can rely on the court's decision if the assets start moving or enter the exchange.
In 2013, a Briton accidentally discarded a hard drive containing his private bitcoin key and then spent years trying to gain access through courts to the landfill where he claimed the drive was located. In Fun fact January 2025, the court dismissed his claim, declaring that the claim had no real prospects, and that the hard drive, after being dumped in the landfill, became the property of the city council. The 8 000 bitcoins lost by Briton account for approximately £ 600 mn
From the monitoring issue No. 5 (29), May 2026. Download the full issue (PDF) · issue page at the Gaidar Institute
