According to recent court filings, a federal judge in Florida has issued a default judgment in favor of Rangan Bandyopadhyay, who sued anonymous hackers for stealing $971,291 worth of USDT from his Coinbase wallet in December 2021. Judge Beth Bloom of the United States District Court Southern District of Florida has ordered the unidentified hackers to pay back the stolen amount to Bandyopadhyay, with interest accruing until the debt is paid in full. However, due to the blockchain’s anonymity, it is unclear who these digital thieves are or where they reside, and they were served notice via NFT using the same on-chain addresses they used to steal from Bandyopadhyay. This marks the first time an American federal court has allowed defendants to be served by NFT.
The trend of serving legal notices via NFTs marks a turning point for legal systems that are struggling to keep up with new types of crime facilitated by blockchain technology. Hackers regularly create elaborate networks of fake companies to persuade unsuspecting victims to link their wallets, which are drained shortly thereafter. It is even more challenging to recover digital funds and assets once they have been stolen. However, according to Fernando Bobadilla, the attorney who represented Bandyopadhyay, the blockchain can be just as problematic for hackers as it is for their victims. Bobadilla is confident that he and his client will recover at least a portion of the stolen funds, though he did not provide details on how that might be possible.
American-based crypto companies like Circle and Coinbase have previously frozen funds or accounts at the behest of the American government. However, USDT, the cryptocurrency stolen from Bandyopadhyay’s wallet, is issued by Hong Kong-based Tether, and Binance, where the stolen funds were deposited, has previously frozen stolen funds transferred to its accounts. Nonetheless, the company has avoided clarifying its home country.