Epic Trust, controlled by alleged scammer Victor Cattermole, was refused permission to join court hearings deciding distribution of assets held by failed cryptocurrency exchange, Cryptopia Ltd. Epic is not directly affected, the High Court ruled. There is no evidence it has any claim to Cryptopia’s remaining assets. Epic’s claim to have purchased digital currency from a Cryptopia customer in a contract complying with laws of the Principality of Cogito, an entity existing in the metaverse controlled by Mr Cattermole as Crown Prince of Cogito, cut no ice with Justice Palmer.
Based in Christchurch, Cryptopia was put into liquidation by shareholders in May 2019 following a hack resulting in the loss of some thirty million dollars by value in cryptocurrency holdings. Liquidators Grant Thornton report that at that time Cryptopia had over 2.2 million registered users. They have identified some 960,000 accounts with positive balances. Account holders are spread across 180 countries. Between them, they hold around 370 different digital currencies.
Account holders have been contacted and asked to verify their balances. Many have not responded.
Liquidators asked the High Court for instructions on how Cryptopia assets should be valued and distributed. Epic Trust sought permission to also make submissions. Liquidators questioned Epic’s motives. They said Epic is not entitled to share in any distribution. They alleged Epic has an ulterior motive; seeking to identify specific account holders and full details of their claimed cryptocurrency holdings.
In 2021, Mr Cattermole was held in contempt of court for improperly obtaining and retaining email addresses of Cryptopia account holders.
Justice Palmer dismissed Epic Trust’s application to join the proceedings. Epic said it purchased Cryptopia digital currency holdings held in the name of a Joshua Stevenson. There is no evidence that Mr Stevenson has transferred this asset, Justice Palmer ruled.
Liquidators dispute whether account balances can be transferred. Cryptopia’s client rules prohibited sale of account balances.
His Honour said there was no need to even consider the validity of an unsigned agreement for sale and purchase between Mr Stevenson and Epic Trust described as being governed exclusively by laws of the Principality of Cogito.
Epic Trust Ltd v. Ruscoe – High Court (24.01.24)
24.045