Self-proclaimed Bitcoin creator, Craig Wright, has been ordered by a Florida District Court Judge to turn over half of his Bitcoin holdings as well as intellectual property rights to the David Kleiman estate.
Following the ruling on Monday on the Kleiman v. Wright case, the judge ruled that Wright should turn over 50% of his Bitcoins, as well as intellectual property rights, that he held before December 31, 2013. Wright may end up forfeiting close to 500,000 BTC which currently is equivalent to around $5 billion.
Ira Kleiman, the brother of the late David Kleiman, filed the lawsuit against Wright last year. He claimed that Wright had stolen Bitcoins that he and his brother had mined when the protocol was still in its early years. He indicated that the estate that was collectively owned by the two was close to 1 million BTC.
The judge ordered Wright to return more than half of his Bitcoin holdings to the Kleiman estate. Although he has an option of an appeal, he nonetheless won’t be able to get a jury trial. The decision on the case was arrived at after the judge rejected the testimony of Wright based on falsifying documents and perjury.
However, there are still procedural issues about the case that are still pending and have to be solved first. The judge’s ruling will have to be adopted first by District Judge Beth Bloom for it to be final. This means that Wright’s defense lawyers may object and that will potentially prolong the case.
In May the court-ordered Wright to declare the public Bitcoin addresses that he owned as of December 31, 2013. Wright has been courting controversy in the cryptocurrency space after claiming that he was the mysterious Satoshi Nakamoto. This is something many prominent figures in the crypto space have squashed. The judge did not make a finding on whether Wright was the famous Satoshi Nakamoto, the creator of Bitcoin.
Recently a UK court dismissed his defamation charge against Roger Ver based on jurisdictional issues. He equally has filed a similar lawsuit that is still on-going against Peter McCormack.
The crypto community is beginning to get concerned about the possibility of a 500,000 BTC dump from Kleiman. The over $5 billion that Wright will turn over is around 3.6% of the total market capitalization of Bitcoin. There is doubt in the crypto community regarding whether Ira Kleiman will decide to dump the BTC and liquidate it for cash.
Craig Wright has weighed in on the matter stating that Ira Kleiman will have to pay around 40% estate tax on the Bitcoins received. For now, some few regulatory issues will have to be solved before Kleiman receives the amount.