Major set back in the Court of Appeal for some Bitcoin Satoshi Vision holders

How to value crypto asset losses following adverse market events? What to do with a distressed crypto asset?

The Court of Appeal’s decision in BSV Claims v Bittylicious & Ors [2025] EWCA Civ 661 has significantly advanced the approach to these often vexed questions.

If a crypto asset is lost, or its value depressed by the wrongful actions of a third party, sometimes (not always) the best solution is to sue for damages. How those damages should be assessed is not always a straightforward question, however. Because some crypto assets have soared in value (despite extreme volatility along the way) – it is tempting to think that, in the event of a loss, damages should reflect expected future value.

The Court of Appeal’s decision in BSV Claims v Bittylicious & Ors keeps the door open to recover damages of this kind, but makes it clear that it will not be easy. Nor will this option apply to every crypto asset.

The Claim in BSV Claims v Bittylicious & Ors – Crypto Currency De-Listed by Exchanges, Value Tanked

Collective proceedings were brought against several crypto exchanges in the Competition Appeal Tribunal (“CAT”) for damages concerning the loss in value of the now well-known Crypto currency called Bitcoin Satoshi Vision (BSV, a product of a hard-fork protocol change in the Bitcoin (BTC) blockchain).

The claim, originally valued at ~£10bn, is in essence that the value of BSV dropped dramatically when it was de-listed by various exchanges, including Kraken (Payward) and Binance in alleged anti-competitive and collusive conduct by those exchanges.

Reflecting the understandably agonising commercial decision which crypto asset holders face following an adverse event of any kind, some BSV holders held on to the coin, whilst others disposed of it.

For claimants who held on to the asset, it was argued that their loss was ~£9bn, based on a counter-factual argument that, were it not for the de-listing, BSV value would have blossomed into a “top-tier” crypto currency – achieving a value of some 350 times more than its value before the anti-competitive conduct complained of.

This issue came to the Court of Appeal for determination.

Court of Appeal decision – what measure of damages can a Claimant recover?

The Court of Appeal decided that the claimants could not pursue losses based on the counter-factual that BSV would have achieved a “top tier” crypto currency.

Why?

Because, in this case, there were alternative coins available on the market at the time to which BSV holders “should” have pivoted following the de-listing. The Court of Appeal’s decision turned on a legal principle to the effect that an injured party will be expected to curb their losses by investing in a substitute, if one is available. This is often known as the “market mitigation” rule.

All this does not mean that the claimants who held on to the asset will not be able to recover damages. It just means that those damages will reflect the value of BSV at the time of the de-listing (plus any consequential losses, such as trading commissions) and not a hypothetical future value.

Analysis

A subtle but critical point in this case is that the Court of Appeal did not have to decide whether there were substitutable alternative coins available on the market. This is because it was an uncontested assertion made for the Claimants that there were.

The Court of Appeal’s decision does not, therefore, tell us exactly how distinctive a crypto currency or other asset will have to be to open the door to the sort of recoveries sought in this case.

However, the good news for those who suffer crypto asset losses is that the door is not closed. This is crucial in the crypto space where very sharp increases in value (as well as decreases) are common.

How we can help

Edwin Coe has a leading class actions practice. It has brought mass group claims seeking damages for both consumers and businesses ranging from financial services mis-selling to price-fixing cartels. The team has multi-case driven expertise in crypto asset litigation, including pursuing Kraken for losses under the UK’s Financial Services legislation.

If you require assistance with crypto asset litigation, please contact Alexander Shirtcliff, of our Commercial Disputes and Class Actions team.

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