A bold legal attempt to claim ownership over billions of dollars in early-mined Bitcoin, including the legendary fortune of Bitcoin creator Satoshi Nakamoto, is falling apart.
According to Alex Thorn, head of firmwide research at Galaxy, the pseudonymous plaintiffs behind the controversial “abandoned bitcoin” lawsuit have quietly dropped 44 of their 39,069 defendants. This move came after on-chain data proved the wallets were actually active.
Thorn noted that every single one of these addresses had moved coins on-chain since the case was filed.
Debunking dormancy claims
The lawsuit was filed recently in the New York County Supreme Court by an anonymous individual going by “Noah Doe” and two Wyoming entities. It originally sought to claim quiet title to over 3.7 million Bitcoin, roughly $274 billion, associated with 39,069 addresses. The plaintiffs attempted to exploit New York’s unusual lost-and-found property statute.
However, the 44 dropped addresses alone held an impressive 21,443 Bitcoin, worth about $1.37 billion, when the case began. These addresses have since moved 46,334 Bitcoin on-chain. For instance, the largest address among the dropped group held roughly 2,100 Bitcoin at the time of the initial filing but pushed 20,405 Bitcoin through the address across ten distinct spends between March and July.
“There’s no evidence any of the 39,000 addresses are lost, but there’s definitely evidence Noah Doe never found them,” Thorn remarked.
A flawed valuation
Doe’s legal team relied on an unnamed expert’s opinion that valued the as-is state of each multi-million dollar address at under $10. They theorized that cracking the keys was uncertain, which seems like a stretch.
The plaintiffs have admitted that their automated algorithm cannot accurately determine whether a wallet is truly abandoned.
As of now, 39,025 defendants still remain active in the lawsuit, including thousands of early “Patoshi” addresses holding Satoshi Nakamoto’s estimated 1.1 million Bitcoin. But analysts believe the entire litigation is effectively dead in the water. The case may have started with a lot of noise, but on-chain evidence has cut it down quickly.
