Court Refuses To Enforce Foreign Arbitration Award Against Cryptocurrency Exchange User

In 2020, Mr Chechetkin, a UK based lawyer, undertook various trading activities on a cryptocurrency exchange platform operated by Payward's UK subsidiary, Payward Ltd (Payward). To trade on the platform, Mr Chechetkin had to confirm the terms and conditions which governed the platform (the Payward Terms). One of the Payward Terms mandated that any disputes be resolved through Judicial Arbitration and Mediation Services (JAMS) arbitration, seated in San Francisco.

Mr Chechetkin incurred losses of over £600,000 on the platform, and sought to recover these funds by initiating proceedings in the English courts. He argued that Payward was undertaking regulated activities and, as it was not authorised, his contract with the company was unenforceable under s.19 of the FSMA and therefore his losses were recoverable.