The Steaker class action case first instance verdict is out: full refund should be made, but does not include Interest and other earnings! Does the judgment hide important legal significance?
The local crypto startup Steaker platform is facing a collective lawsuit judgment due to the FTX collapse. (Background: The Steaker case may require constitutional interpretation! Lawyer from Guoke: The most important judgment affecting crypto investment in Taiwan) (Background information: Steaker founder responds to "indictment analysis": seriously defaming and blackening the crypto startup, legal action will be taken) The Taiwan-based digital asset management platform Steaker (思帝科) is unable to repay all user investments due to its involvement in the FTX collapse. Although the platform proposed a subsequent repayment plan, founder Wilson Huang has been sued for violating the Banking Act, and affected users have filed multiple collective and individual lawsuits demanding repayment from Steaker. Yesterday, the first instance judgment of the first collective lawsuit against Steaker was released. The Taipei Court's case number 112年度金字第50號 involves a collective claim from 63 plaintiffs, asserting amounts of BUSD 48,724.18, USDC 232,734.18, and USDT 636,505.25, totaling approximately 917,963.61 USD (over 28.15 million NTD). The plaintiffs claim that Steaker and Wilson Huang should pay the above amounts, with interest calculated at an annual rate of 5%. However, the court recognized that the defendants should return the plaintiffs' amounts but rejected requests for investment returns and interest. The plaintiffs can request provisional execution for the winning part but must provide a corresponding guarantee amount. The defendants can also request exemption from provisional execution, which similarly requires a higher guarantee. What important legal significance is hidden in this judgment? In the judgment, the court mentioned that Steaker, under the guise of a digital asset management platform, offered multiple yield schemes, indicating "guaranteed fixed interest rates of 8% to 9.5%", and "will only lose 1% at most", attracting users to invest in stablecoins. Such behavior is regarded as "guaranteed profit and capital preservation"; the returns offered by Steaker's investment options "differ greatly from general bank deposit rates" and would attract unspecified public investments. This behavior, by law, constitutes "receiving deposits", and since Steaker is not a bank, it violates Article 29 of the Banking Act "protecting others" and thus bears tort liability. The plaintiffs' request for damages under Article 184, Section 2 of the Civil Code is justified. Article 29, Section 1 of the Banking Act states, "Except as otherwise provided by law, non-banks shall not operate receiving deposits, managing entrusted trust funds, public property, or conducting domestic and foreign exchange transactions." The so-called "receiving deposits" is defined in Article 5-1 of the Banking Act as "receiving funds or attracting investments from unspecified individuals and agreeing to return the principal or provide equivalent or higher than the principal." Article 29-1 of the Banking Act regulates that receiving funds or attracting investments under other names from multiple or unspecified individuals, agreeing or providing dividends, interest, dividends, or other returns that are significantly disproportionate to the principal, shall be treated as receiving deposits. Violating Articles 29 and 29-1 of the Banking Act will be considered as a violation of the illegal fundraising crime under Article 125 of the Banking Act. In this ruling, we observe that although the defendants (Steaker and Wilson Huang) claim that "no statutory currency has been received", stablecoins and Bitcoin are not considered "funds" under the Banking Act, the Taipei District Court recognized that in Steaker's business model, cryptocurrencies are regarded as funds with legal value. However, it is worth mentioning that since the court believes stablecoins are not fiat and cannot accrue interest, the plaintiffs are unable to be compensated for interest. It is assessed that this first-instance judgment may influence other Steaker-related lawsuits and civil cases. Further reading: Guoke's article: A brief commentary on the Steaker case: Why is receiving pure U investments the most important judgment in Taiwan's crypto world? This case can be appealed, but the plaintiffs can also request provisional execution for repayments. Dongqu reminds readers that according to the presumption of innocence, the defendant is presumed innocent until proven guilty by a final judgment. Related reports: Heavyweight! SEC and CFTC issue a joint statement "Protecting American Innovation": Not prohibiting exchanges from listing coins, including margin leverage functions. Another exchange collapses! Xeggex allegedly "ran away with funds", users lament being unable to log in, and wallet balances drop to zero. <Steaker collective lawsuit first instance released: Full repayment required, but not including interest and other returns! What important legal significance does the judgment hide?> This article was first published in Dongqu BlockTempo, "Dongqu Trend - The most influential Blockchain news media."
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The Steaker class action case first instance verdict is out: full refund should be made, but does not include Interest and other earnings! Does the judgment hide important legal significance?
The local crypto startup Steaker platform is facing a collective lawsuit judgment due to the FTX collapse. (Background: The Steaker case may require constitutional interpretation! Lawyer from Guoke: The most important judgment affecting crypto investment in Taiwan) (Background information: Steaker founder responds to "indictment analysis": seriously defaming and blackening the crypto startup, legal action will be taken) The Taiwan-based digital asset management platform Steaker (思帝科) is unable to repay all user investments due to its involvement in the FTX collapse. Although the platform proposed a subsequent repayment plan, founder Wilson Huang has been sued for violating the Banking Act, and affected users have filed multiple collective and individual lawsuits demanding repayment from Steaker. Yesterday, the first instance judgment of the first collective lawsuit against Steaker was released. The Taipei Court's case number 112年度金字第50號 involves a collective claim from 63 plaintiffs, asserting amounts of BUSD 48,724.18, USDC 232,734.18, and USDT 636,505.25, totaling approximately 917,963.61 USD (over 28.15 million NTD). The plaintiffs claim that Steaker and Wilson Huang should pay the above amounts, with interest calculated at an annual rate of 5%. However, the court recognized that the defendants should return the plaintiffs' amounts but rejected requests for investment returns and interest. The plaintiffs can request provisional execution for the winning part but must provide a corresponding guarantee amount. The defendants can also request exemption from provisional execution, which similarly requires a higher guarantee. What important legal significance is hidden in this judgment? In the judgment, the court mentioned that Steaker, under the guise of a digital asset management platform, offered multiple yield schemes, indicating "guaranteed fixed interest rates of 8% to 9.5%", and "will only lose 1% at most", attracting users to invest in stablecoins. Such behavior is regarded as "guaranteed profit and capital preservation"; the returns offered by Steaker's investment options "differ greatly from general bank deposit rates" and would attract unspecified public investments. This behavior, by law, constitutes "receiving deposits", and since Steaker is not a bank, it violates Article 29 of the Banking Act "protecting others" and thus bears tort liability. The plaintiffs' request for damages under Article 184, Section 2 of the Civil Code is justified. Article 29, Section 1 of the Banking Act states, "Except as otherwise provided by law, non-banks shall not operate receiving deposits, managing entrusted trust funds, public property, or conducting domestic and foreign exchange transactions." The so-called "receiving deposits" is defined in Article 5-1 of the Banking Act as "receiving funds or attracting investments from unspecified individuals and agreeing to return the principal or provide equivalent or higher than the principal." Article 29-1 of the Banking Act regulates that receiving funds or attracting investments under other names from multiple or unspecified individuals, agreeing or providing dividends, interest, dividends, or other returns that are significantly disproportionate to the principal, shall be treated as receiving deposits. Violating Articles 29 and 29-1 of the Banking Act will be considered as a violation of the illegal fundraising crime under Article 125 of the Banking Act. In this ruling, we observe that although the defendants (Steaker and Wilson Huang) claim that "no statutory currency has been received", stablecoins and Bitcoin are not considered "funds" under the Banking Act, the Taipei District Court recognized that in Steaker's business model, cryptocurrencies are regarded as funds with legal value. However, it is worth mentioning that since the court believes stablecoins are not fiat and cannot accrue interest, the plaintiffs are unable to be compensated for interest. It is assessed that this first-instance judgment may influence other Steaker-related lawsuits and civil cases. Further reading: Guoke's article: A brief commentary on the Steaker case: Why is receiving pure U investments the most important judgment in Taiwan's crypto world? This case can be appealed, but the plaintiffs can also request provisional execution for repayments. Dongqu reminds readers that according to the presumption of innocence, the defendant is presumed innocent until proven guilty by a final judgment. Related reports: Heavyweight! SEC and CFTC issue a joint statement "Protecting American Innovation": Not prohibiting exchanges from listing coins, including margin leverage functions. Another exchange collapses! Xeggex allegedly "ran away with funds", users lament being unable to log in, and wallet balances drop to zero. <Steaker collective lawsuit first instance released: Full repayment required, but not including interest and other returns! What important legal significance does the judgment hide?> This article was first published in Dongqu BlockTempo, "Dongqu Trend - The most influential Blockchain news media."