Is Cryptocurrency Likely To Be Accepted By The Cayman Islands And BVI Courts As A Form Of Security?

As part of our series looking at the potential impact of recent cases on the future decisions of the Cayman Islands and the BVI Courts relating to crypto assets, we consider the recent English decision of Tulip Trading Limited v Bitcoin Association for BSV and others [2022] EWHC 141 (Ch), and specifically whether cryptocurrency is likely to be accepted by the Courts as a form of security.

The claimant in Tulip Trading requested that the form of security it be required to provide be cryptocurrency in circumstances where providing cash would be onerous for the claimant. The claimant proposed that it transfer this cryptocurrency to its legal counsel including an additional 10% buffer to account for the potential change in the price of the cryptocurrency between the time it was transferred and when it may be required to settle the defendant's legal costs. The cryptocurrency offered by the claimant was Bitcoin Satoshi Vision or Bitcoin Core. Notwithstanding the 10% buffer