A guy in Bengaluru tried to sue the website where he had bought Bitcoin after losing a substantial amount of cryptocurrency. He unfortunately lost the lawsuit since the court found that he was a victim of cybercrime and that the bitcoin trading platform had not broken any service rules. Due to their ability to generate large amounts of money and lack of centralization, cryptocurrencies have seen a sharp increase in popularity recently. However, as their use increases, several issues are beginning to surface and the need for regulation is important. Lets explore this case and discover the potential solution to deal with this problem.
The Theft
Something terrible occurred to Prashanth from Nayandahalli on December 15, 2022. He was trading cryptocurrencies on a platform called Giottus. However, he encountered a server issue and his transaction was unsuccessful. When he checked his account on the app the following day, he was astounded by what he saw. He had lost the 12,484 USDT that he owned. Prashanth phoned the company’s customer care to ask for assistance since he was quite agitated. They gave him several instructions, but regrettably, nothing worked to resolve the issue. Prashanth chose to file a complaint over his pilfered bitcoin due to his extreme frustration. He didn’t get a nice response from the firm. They claimed their insurance did not cover cyberattacks, therefore he was unable to get his money back.
The Legal Action
Prashanth filed a complaint on December 23, 2018, with the Bengaluru Police’s cybercrime unit, and thereafter approached the Bengaluru Urban Second Additional District Consumer Disputes Redressal Commission. He claimed that he didn’t receive adequate service from the app and requested payment to make up for his losses. Prashanth sued the app in court, and he was assisted in his case by a professional accountant. Prashanth shouldn’t be allowed to file a complaint, according to Giottus’ attorney, because he wasn’t a customer and was dealing in cryptocurrency that the Indian government doesn’t acknowledge. Additionally, the attorney claimed that throughout the trading process, Prashanth’s account was compromised. They said that Prashanth was unable to receive assistance from the commission as a result. They claimed that Prashanth’s account was hacked because he entered his credentials into the incorrect website. Additionally, they stated that phishing-related hacking is not covered by insurance. However, on September 19, the City Consumer court ruled that the cryptocurrency company had done nothing illegal and that Prashanth was the victim of cybercrime. They thus dismissed the lawsuit.
Impact on the Crypto Community
Pic Credit- gamerseo
The expanding crypto industry will be greatly impacted by this significant decision. It demonstrates the significance of extreme caution and diligence on the part of cryptocurrency users while trading or making investments with digital currency. It also demonstrates that online trading platforms are not necessarily liable for financial losses resulting from cybercrimes such as deception, hacking, or other online frauds.
The Potential Solution
Although there have been some frauds in the cryptocurrency space, the sector is always evolving and looking for methods to make things safer. I’ll give you an illustration. The Oyster Pearl fraud was one of these scams. If the exchanges had implemented a KYC process, it may have been avoided. In essence, it means that they would examine the users’ personal information. All of the major exchanges began doing this following that fraud.
In addition to increasing security and extensively verifying the code, consumers are also receiving wallet insurance. This implies that the insurance provider will reimburse you in the event that your cryptocurrency is stolen. Even some major insurance providers, like AON, Marsh & McLennan, and Lloyd’s London, have made significant financial commitments to the cryptocurrency industry.
Why doesn’t the government regulate these trades more, one may question. Since cryptocurrency is still relatively new, the regulations are still being worked out. However, you may be certain that an insurance provider has examined the exchange and determined it to be secure if they consent to insure it. Although nothing is infallible, having insurance offers some comfort to those who need it.
Conclusion
Even though the Bengaluru man’s legal struggle ended in failure, it highlights important issues regarding the security of cryptocurrency and the necessity of strict regulatory procedures. This case serves as a warning to the growing number of people using cryptocurrency that they should be cautious and take precautions to ensure the security of their funds. It must ensure that robust cyber security is in place, safety measures are put in place, and that everyone has knowledge about the potential dangers. We can make cryptocurrencies safer for everyone if we take care and learn from what happened to this person.
