The Seoul District Court issued a landmark judgment in favor of investors who lost virtual assets as a result of a hacking event at cryptocurrency exchange Coinrail.
The court ordered on Wednesday that Linus Co., operator of the Coinrail exchange, must pay the plaintiffs 380 million Korean won (about US$320,000). The plaintiffs, 11 former Coinrail exchange users, filed the case in September 2018 seeking damages for a hacking incident earlier that year that resulted in the loss of cryptocurrency valued at more than US$40 million. Ethereum, FundX, and Aston were among the crypto tokens stolen.
Coinrail was shut down shortly after the hacking incident occurred. It made a promise to its users that it would compensate them for the stolen coins, but did not follow through. The district court’s judicial panel determined that the exchange is required to refund the virtual assets that were lost, as indicated in the exchange’s terms and conditions.
The court, however, determined that Coinrail was not accountable for the hacking incident. Additionally, the court dismissed the plaintiff’s argument that the exchange transferred investors’ crypto assets from individual e-wallets to Coinrail’s own e-wallet, claiming that this increased the assets’ hackability.
Meanwhile, investigators recovered a portion of the stolen bitcoin (1360 ETHs) held at a Latin American cryptocurrency exchange three years after it was taken.
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