Atomic Wallet Faces Lawsuit in the US Over $100M Cyber Hack, Seeks Dismissal

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Published: November 20, 2023 at 4:20 am Updated: November 20, 2023 at 4:20 am

Edited and fact-checked:
November 20, 2023 at 4:20 am

In Brief

Atomic Wallet is requesting the dismissal of a class action lawsuit in the US that stems from a recent $100m hacking incident.

Atomic Wallet, an Estonia-based cryptocurrency wallet company, has sought dismissal of a US class action lawsuit related to a $100 million hack. The company said it has no connections to the United States and insists that any legal action against it should occur in Estonia, its country of origin and location of its headquarters.

In their motion filed in a Colorado District Court on November 16, Atomic Wallet pointed out that only one of the plaintiffs in the lawsuit is from Colorado. The company asserts that its user agreement, accepted by around 5,500 users, explicitly limits litigation to Estonia. It also disclaims liability for losses due to theft, capping damages at $50 per user.

Atomic Wallet Challenges the Legal Basis of the Claims

Atomic Wallet has also challenged the legal merit of the negligence claims made by the plaintiffs. Atomic Wallet asserts that they did not have an established legal duty to maintain security against hacking. The company has cited Colorado’s legal precedence, which does not recognize such a duty.

Atomic Wallet has refuted allegations of fraudulent misrepresentation in the lawsuit. This move comes following the class action launched in August, two months after the significant security breach that affected up to 5,500 users. Groups from North Korea and Ukraine are believed to have executed the attack, leading to a $100 million loss.

The lawsuit against Atomic Wallet highlights the complexities of jurisdiction and legal responsibility in the globalized and decentralized world of cryptocurrency. The outcome of this legal battle could set a precedent for how international crypto firms engage with US laws and litigations.

We await the Colorado District Court’s decision on Atomic Wallet’s motion to dismiss. This decision could significantly impact the legal landscape for international cryptocurrency businesses.

The case highlights the difficulties in determining legal responsibilities in the digital asset arena, particularly with cross-border operations at play.

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About The Author

Nik is an accomplished analyst and writer at Metaverse Post, specializing in delivering cutting-edge insights into the fast-paced world of technology, with a particular emphasis on AI/ML, XR, VR, on-chain analytics, and blockchain development. His articles engage and inform a diverse audience, helping them stay ahead of the technological curve. Possessing a Master’s degree in Economics and Management, Nik has a solid grasp of the nuances of the business world and its intersection with emergent technologies.

Nik Asti