Hong Kong courts now use blockchain to serve legal notices to crypto wallets, streamlining action against illicit activities and anonymous owners.
Hong Kong courts have made a big change by using blockchain to send legal notices to crypto wallets. With this new model, it’s easy to send notices to wallets that are doing illegal things.
This way helps solve the issue of hidden identities in crypto transactions better than other methods.
Cointelegraph says this happened because of a court order that involved two wallets on the Tron blockchain. The court froze funds that were linked to an online scam. This shows that Hong Kong is becoming more willing to use blockchain for law issues.
For years, it’s been hard to serve legal documents in the crypto business. Regular ways of communicating, like in-person delivery, mail, or email, don’t always work when working with people who own anonymous crypto wallets.
In one case, 2.65 million USDT that was taken in an online scam was frozen by a court order. Before the alerts could get to the wallets, some money was moved to swaps. The wallet has been stopped because there is only 1 million USDT left in it.
Joshua Chu, a cybersecurity expert at Macro Systems, came up with the idea for the tokenized messages on the Tron network because of these problems. This is especially interesting because the Tron blockchain is often linked to illegal activities, despite its many great successes.
Hong Kong’s government has been able to easily freeze suspicious wallets with the help of this new technology. This method has successfully limited access to the frozen wallets and stopped any further transactions.
Chu explained that if a transaction goes through with frozen assets, it would violate criminal law. Also, centralized platforms probably wouldn’t want to work with these wallets either. This is because they have to follow the law when it comes to Know Your Customer and Anti-Money Laundering (AML).
As a side note, Hong Kong is not the only place that uses blockchain to send legal warnings. This plan has also been tried in places like the US and UK. But Hong Kong’s move is especially important because it stops suspects from using secrecy as a defense.
Macro Systems wants to make its technology work with more blockchains, like Ethereum and Polygon, because both of them are being used for more illegal things. There are already plans in place to start on the Bitcoin network later this year.
Global Legal Systems are Starting to use Blockchain
Tokenized legal warnings are being used more and more in Hong Kong. Courts all over the world are now looking into how blockchain technology can be used in court cases. In the case of Osbourne v. Persons Unknown, the High Court in the UK recently put stolen NFTs on hold.
NFT airdrops were used to send the court papers. In the US case LCX AG v. John Doe Nos. 1–25, court documents were sent straight to private cryptocurrency wallets. This made sure that the defendants got the warning even though they stayed anonymous.
Even though blockchain is still new in the court world, these cases show how it can be used to solve tough cases. But experts like Laurenth Alba from Rome Protocol say that blockchain is still hard for lawyers to understand.
Laws that use this way are hard to enforce because there aren’t any standard rules and laws around the world are different. This shows that blockchain and legal processes need to work together better.