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Italian Court Seizes Crypto Exchange BitGrail’s Bitcoin Wallets

Last Updated March 4, 2021 5:08 PM
Josiah Wilmoth
Last Updated March 4, 2021 5:08 PM

An Italian court has seized bitcoin wallets belonging to shuttered cryptocurrency exchange BitGrail as part of the company’s bankruptcy proceedings.

BitGrail disclosed that its assets had been seized in a statement dated June 15, explaining that it had turned over the bitcoin wallets on June 5 in response to an order from the Tribunal of Florence.

From the statement:

“On June 5, 2018, pursuant to the Tribunal of Florence orders, the Bitcoins contained in the company’s wallets were seized and brought under control of the judicial authorities pending further Court decisions in the prebankruptcy proceeding.”

As CCN.com reported, BitGrail has effectively been shut down since February, when founder Francisco “The Bomber” Firano revealed that nearly all of the platform’s nano (XRB) reserves — approximately 17 million XRB, then worth $170 million — had gone missing, forcing the exchange into insolvency.

There was much controversy over who was responsible for the missing XRB. Nano’s developers argued that a bug in the exchange’s software had led to the loss or theft of the funds and accused Firano of concealing BitGrail’s insolvency for an extended period of time.

“To date, all reliable evidence we have reviewed continues to point to a bug in BitGrail’s exchange software as the reason for the loss of funds,” the Nano Foundation wrote in an April update.

Firano, meanwhile, blamed the development team, alleging that the fault lay in the Nano protocol, not his platform’s software.

BitGrail had attempted to re-open its exchange in early May but was forced to shut down just three hours later after a lawyer acting on behalf of a BitGrail customer successfully petitioned the court to bar the company from resuming its operations.

BitGrail is currently moving through preliminary bankruptcy proceedings as creditors seek to recover a portion of the assets that they lost when the funds went missing. Firano has criticized creditors for forcing the platform into bankruptcy court rather than letting the exchange re-open and attempt to earn back the funds to fully compensate traders.

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