Defendant Moves to Dismiss New York Case Seeking Control of 39,069 Bitcoin Wallets

TL;DR:

• A defendant identified as “John Doe 33” filed a motion to dismiss New York’s lawsuit targeting 39,069 dormant Bitcoin wallets.
• The lawsuit, filed in May, seeks to claim 3.7 million dormant Bitcoins with an estimated value of $234 billion.
• According to blockchain data, “John Doe 33” controls a wallet holding 5,000 Bitcoins inactive since 2014, valued at over $300 million.

A defendant in the New York lawsuit seeking control of 39,069 dormant Bitcoin wallets filed a motion to dismiss the complaint, arguing that network addresses are simple data strings and not persons or legal entities subject to the court’s jurisdiction.

The defendant, pseudonymously identified as “John Doe 33“, filed a notice of appearance and the dismissal motion, claiming to control one of the wallets listed in the filing. According to the document, the complaint is legally defective because a public Bitcoin address cannot be considered “found” under New York’s lost property law, given that it has always been visible on the blockchain.

Legal Roadblocks

The action was initiated in May by a plaintiff identified as “Noah Doe” and two limited liability companies based in Wyoming, ABC Company and XYZ Company. The plaintiffs argue that the funds linked to the listed addresses constitute abandoned property, which was reported to the New York Police Department and claimed under local lost property legislation. The filing includes 39,069 addresses, among them wallets widely associated with Bitcoin’s creator, Satoshi Nakamoto, and the Mt. Gox hacker.

Alex Thorn, head of research at Galaxy Digital, noted that blockchain data suggests “John Doe 33” controls a wallet holding 5,000 BTC received in April 2014, with no recorded activity in over twelve years. At current prices, that position exceeds $300 million, approximately one hundred times the average value of the other addresses included in the lawsuit. Thorn highlighted that the filing avoided what would have been a nearly inevitable default judgment and that it exposed jurisdictional and regulatory flaws in the plaintiffs’ claim.

Private Keys and Dormant Bitcoins

Regardless of the judicial outcome, a fundamental practical limitation remains: without the private keys that grant access to each wallet, the plaintiffs would have no way to recover the funds even if the court ruled in their favor. According to Bitbo data, there are currently 3.5 million BTC with no recorded movement in over ten years and another 6.6 million dormant for more than five, with estimated values of $215 billion and $406 billion respectively.