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Quoine Found Guilty of Breach of Contract in BTC 3,902 Trade Reversals

Quoine Found Guilty of Breach of Contract in BTC 3,902 Trade Reversals 101
Pediment sculpture of the Old Supreme Court, City hall Singapore. Source: iStock/Aneurysm

Singapore’s Court of Appeal has ruled that the cryptocurrency exchange operator Quoine wrongfully reversed a number of trades made on its platform – and is set to order it to pay compensation.

Per the Straits Times, the court refused to accept claims from Quoine's legal team, which said that it was acting in good faith, and believed that seven trade orders placed by the electronic market maker and liquidity provider B2C2 in 2017 had been issued due to a mistake.

The court will now listen to arguments from both sides before deciding on the size of the compensation due to B2C2.

The report’s author wrote,

“Quoine argued that the parties who transacted with B2C2 were under the mistaken belief that the trades were at market price and that B2C2 knew of this mistake.”

The transactions involved ethereum (ETH) to bitcoin (BTC) sales, and B2C2 claims that the Quoine move effectively resulted in a four-figure BTC loss.

The court heard that on April 19, 2017, B2C2’s software ordered the seven trades, with BTC 3,092 (today - USD 29 million) credited to B2C2 in exchange for ETH 309 (USD 80,000) debited.

Quoine learned the details of the trades on April 20, when it reversed the transactions.

However, B2C2 went on to argue that the reversals represented both a breach of contract and a breach of trust. The five-judge panel said that trust had indeed been broken in this instance.

The case is Singapore’s first high-profile cryptocurrency trial. And the same media outlet claims it is the first in a Commonwealth country whereby judges have been asked to rule on the legality of contracts made by computerized trading platforms.

Meanwhile, in February, Seychelles-registered crypto exchange Poloniex has rolled back 12 minutes of trading history after a bug detected in the system caused trades to be “executed erroneously.”

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