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Australian court allows cryptocurrencies to be used as security in a defamation case

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As the first and the biggest cryptocurrency, Bitcoin (BTC) was designed to be a peer-to-peer payments system that could function without reliance on a third party. Since its inception, the cryptocurrency has been fuelling the financial revolution against centralized economies and is responsible for the foundation of the entire crypto-industry that exists today.

Over the years, Cryptocurrencies have grown to be useable both as a medium of exchange and as a store of value alongside various other utilities. There have been multiple scenarios where cryptocurrencies like BTC have been used to battle inflation and economic recessions. All these attributes, combined with the security and privacy of a blockchain network have boosted crypto use amongst the masses.

The popularity of cryptocurrencies aren’t just limited to tech enthusiasts anymore, various government bodies and officials have also taken a lot of interest in digital currencies for both good and bad reasons. While some consider these a tool for mere criminal activities, there are some that see the massive potential this technology holds and are prone to adopting it.

Highly unstable, but a recognized form of investment

In a particularly interesting case, an Australian court has recently agreed to allow a crypto-exchange account to be used as security for legal expenses, with the judge citing that cryptocurrencies are a recognized form of investment.

Hearing a defamation claim, the New South Wales District Court was recently requested by the defendant to order the plaintiff to put $20,000 AUD into a court-controlled bank account, the Australian Associated Press reported Thursday. The money was to be used to cover some of the defendant’s expected legal costs if the plaintiff loses the case or decides to withdraw it altogether.

The request was accepted by the court and the plaintiff was also allowed to use a cryptocurrency exchange account as security. The defendant’s lawyer pointed out that despite the account being evaluated in Australian dollars; the virtual currencies in it were a highly unstable investment.

Judith Gibson, the judge presiding over the case, stated that she was prepared to accept that cryptocurrencies are indeed volatile. “However, this is a recognized form of investment,” she pointed out in a judgment issued earlier this week.

To ease the tension related to the price fluctuations of the said crypto-assets, the judge also accepted the plaintiff’s undertaking to provide the defendant’s solicitor with monthly statements and also alert the solicitor when the account drops below $20,000.

“I can see the desirability of the defendant receiving prompt notification of any drop in the value of the account. These are uncertain financial times,” Judge Gibson added.Australia has been really active in the efforts to regulate the crypto and blockchain space. Recently, the nation released its much-awaited blockchain roadmap in the first week of February. The new policy is aimed at boosting the use of blockchain technology across various sectors within the nation, making it a global leader.

Anna Larsen
Anna Larsen has been a Crypto enthusiast since 2016. Fascinated by the technology and its usecases she decided to pursue a career in content creation related to this space. The journey has been exciting ever since.

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