SINGAPORE Trends and Developments Contributed by: KOH Swee Yen, SC, Wendy LIN, TIONG Teck Wee and Monica CHONG Wan Yee, WongPartnership LLP
Distribution of cryptocurrency in the liquidation of a company – Re Taylor, Joshua James and another (Official Receiver, non-party) [2025] SGHC 104 Following the liquidation of Eqonex Capital Pte Ltd (which operated a digital asset exchange platform (“Exchange”)), the company’s liquidators sought orders relating to the distribution of, among other things, unclaimed cryptocurrencies stored in digital wallets hosted on the Exchange. Among other things, the liquidators sought orders to the effect that (a) the liquidators may deal with such cryptocurrencies as if they were held by the company for the benefit of the company’s customers; and (b) the liquidators may dis- tribute the cryptocurrencies to customers in line with a filed distribution plan. The General Division of the High Court found that the liquidators had no power to distribute the unclaimed cryptocurrencies, as both the legal and beneficial titles in the unclaimed cryptocurrencies vested with the customers. The Court found that there was no express trust created over the cryptocurrencies. While they are referred to as “custodial assets” in the Exchange’s terms and conditions (T&Cs), that did not amount to a declaration of trust by the customers. The Court held that, while the phrase may indicate a desire for the Exchange to hold only the legal title with the beneficial title residing in the customers, the cryptocurrencies “could just as much be held on a pledge or some level of control less than a proprietary interest”. The existence of an express trust was also contradicted by other parts of the T&Cs. The Court also rejected the liquidators’ alternative argument that there was a resulting and/or Quistclose trust over the cryptocur- rencies. Developments Relating to Arbitration Application of transnational issue estoppel in the context of asserted state immunity – Hulley Enterprises Ltd and others v The Russian Federation [2025] SGHC(I) 19 Following the Court of Appeal’s confirmation in The Republic of India v Deutsche Telekom AG [2024] 1 SLR 56 (“ Deutsche Telekom ”) that the doctrine of transna- tional issue estoppel (“Doctrine”) applies in the con- text of international arbitration, the SICC applied the Doctrine in Hulley v Russia to preclude an assertion of state immunity.
Developments Relating to Cryptocurrency SICC hears first representative action, issues decision on the collapse of the TerraUSD stablecoin (UST) – Beltran, Julian Moreno and others v Terraform Labs Pte Ltd and others [2025] SGHC(I) 17 (“Beltran Action”) In the first representative action brought under Order 10, rule 19 of the Singapore International Commercial Court (SICC) Rules 2021, ten representative claimants representing 356 other claimants, all of whom were holders of UST tokens at the time of the Terra-Luna crash in May 2022, sued (a) Terraform Labs Pte Ltd (“Terraform”, the Singapore-incorporated issuer of UST), (b) Mr Kwon Do Hyeong (Terraform’s majority shareholder, director and CEO); and (c) Luna Founda- tion Guard Ltd (another Singapore-incorporated entity which issued a sister coin to UST, LUNA tokens) for losses they sustained from the crash. The claimants brought claims for misrepresentation, breach of con- tract, conspiracy, and inducement of breach of con- tract. As not all issues of liability and quantum were common among the claimants, the SICC bifurcated the pro- ceedings into two tranches pursuant to Order 16, rule 11 of the SICC Rules 2021 – a first tranche addressing issues pertaining to liability that were common to the claims (such as whether certain alleged representa- tions are actionable at law), with the remaining issues reserved for a second tranche. The claimants ultimately prevailed, but only partially; the SICC awarded damages to seven out of ten rep- resentative claimants (albeit significantly less than the amounts claimed – the cumulative claims of the seven successful representative claimants were in excess of USD1.3 million, while the total damages awarded amounted to just over USD450,000) for the defend- ants’ fraudulent misrepresentations (found in, among other things, publications on Terraform’s website), which induced the claimants to purchase UST and caused them to suffer loss as a result. The SICC found that the remaining representative claimants could not prove that they had relied on the misrepresentations (and thus did not award damages to those claim- ants) and also dismissed the remaining claims (ie, the claims of breach of contract, inducement of breach of contract, and conspiracy).
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