Italian Authorities Seize Bitcoin From BitGrail Wallets Following Court Order

Italian cryptocurrency exchange BitGrail has announced that bitcoins (BTC) stored in the firm’s wallets have been seized by Italian authorities, according to official announcement published June 15.

The statement says that authorities removed the funds from the exchange’s wallets following a court order by the Tribunal of Florence on June 5, but did not mention the current worth of the seized assets:

“On June 5, 2018, pursuant to the Tribunal of Florence orders, the bitcoins contained in the company’s wallets were seized and brought under control of the judicial authorities pending further Court decisions in the pre-bankruptcy proceeding.”

The seizure of BitGrail’s BTC follows a petition to the court filed by victims of the BitGrail hack, asserting that the exchange is bankrupt under article 6 of Italian bankruptcy law. The petition was filed on behalf of a BitGrail creditor, Espen Enger, whom over 3,000 claimants have allegedly contacted so far.

In February, BitGrail suffered a cyber attack that caused the loss of 17 million Nano (XRB, formerly Raiblocks) that was worth $187 million at the time. After trading was halted, CEO Francesco Firano argued that it would be impossible to refund the stolen amount.

The hack caused a series of arguments between BitGrail and the Nano Foundation ас it was unclear whether hackers exploited a BitGrail security weakness or a vulnerability in Nano’s blockchain.

In April, the Nano Foundation announced it would support a legal fund to provide all victims of the hack with equal access to representation to pursue their legal interests associated with BitGrail’s insolvency.

On May 3, Bitgrail reopened, but three hours later shut down operations at the order of the court of Florence. The court ordered an immediate closure of the exchange in accordance with a request made by Bonelli law office on behalf of a client. The exchange stated, “Even though we don't agree with this decision, we are obliged to respect the law and to suspend any BitGrail business immediately.”