After a 2 year waiting game, customers of the ACX exchange have secured an order in the Supreme court of Victoria to freeze assets of Blockchain Global, with the plaintiffs in pursuit of more than AUD$10 million dollars worth of allegedly missing digital assets.
It was in February 2020 that we first wrote about the mysterious shutdown that unfolded after the Melbourne based exchange froze a large chunk of customer funds, blaming an "audit" process which has still not been explained. At the time of the story breaking, ACX user Michael Whitehorn correctly predicted that the then "$1m+ dollars of exposed [assets]" was just "the tip of the iceberg". The claims against the exchange have a present value of over $10 million dollars.
Frustrated customers were faced with Blockchain Global distancing itself from the exchange, and ACX's Terms of Use changing just before the freeze to assert the exchange was being operated by another company by the name of "Peak Trading Group Pty Ltd". Previously the Terms of Use identified the website operator as "Blockchain Global Limited".
Christos Stathopoulos, solicitor for the plaintiffs, gave evidence that ACX's terms of use said all digital assets and cash was held on trust on behalf of the users, and therefore that the plaintiffs would be entitled to seek damages from Blockchain Global, ACX and its directors for the missing assets.
In the affidavit Stathopoulos further alleged:-
I believe that [Blockchain Global] has misappropriated cryptocurrency (and cash earned or invested with respect to the sale of cryptocurrency) belonging to the plaintiffs with a present value of $10,344,904.30.
On an interim basis at least, Blockchain Global's alleged involvement has been recognised as a serious enough matter for Justice Riordan to issue the freezing order to protect the plaintiffs, given there is a "serious question as the whether or not the plaintiffs have been defrauded" by Blockchain Global. We should note that no finding of wrongdoing against Blockchain Global has occurred at this time.
At first the freezing order was only issued over a digital wallet containing around 120 bitcoins and presently worth around AUD$6.8 million dollars. However, the order was then extended to all of Blockchain Global's assets given "the freezing order would barely cover the plaintiffs claim".
After such a long period of uncertainty, with a winding-up application recorded in the meantime against Blockchain Global (but dismissed), the wheels of justice are slowly moving in relation to this matter.
A freezing order remains a temporary relief which does not make any finding of wrongdoing or finding of any facts against ACX or Blockchain Global Limited, and Blockchain Global Limited may well dispute the whole of the allegations, which will be the subject of evidence and a final hearing at a later date.