BitGrail cryptocurrency exchange returns, immediately shuts down
The Nano-BitGrail incident has taken another twist, bringing more clarity to affected Nano holders.
BitGrail came back to life on 2 May, but only very briefly before a three-judge panel in Florence, Italy, ordered it to close again.
"The order is to have immediate effect, with possible criminal sanctions if violated. The court will hear the arguments of both sides before making a final decision on the possible bankruptcy of BitGrail. In the meantime, trustees have been appointed to secure BitGrail's assets," the order reads.
The order also says that the re-opening of BitGrail involves "the concrete danger of depletion of the assets of the bankruptcy and possible dispersion of the means of proof for ascertaining the causes and responsibility at the base of the Nano losses," which may not do BitGrail any favours in the ensuing court battle.
The BitGrail wallet saw a lot of activity in its brief time up, with millions of dollars' worth of cryptocurrency moving in and out. It's not clear whose money that was though, and whether it was hopeful traders returning to the platform or something more unusual.
Whatever might be going on behind the scenes, the reopening and near-immediate court order might be good news for Nano traders who lost coins in the BitGrail incident, bringing a bit more clarity to the situation. The order seems to slap BitGrail on the wrist and assert that the court will be hearing both sides of the argument before making a decision on the bankruptcy, which effectively closes one of the three doors BitGrail-Nano victims had open.
The first door, which seems to have just been slammed shut, was to come back to BitGrail and take up its offer for attempted compensation.
The two remaining options involve picking a side in the class action lawsuits that have emerged from the incident.
- Siding with Nano: An Italian law firm is representing a group of victims against BitGrail, and anyone who lost funds in the incident is free to register for it.
- Siding against Nano: An American law firm is representing a group of victims against Nano, claiming that the developers recklessly directed them towards BitGrail and it's their fault. In an unusual and perhaps somewhat ineffectual first, this class action suit is ordering Nano developers to perform a recovery hard fork.
No blame for the loss has been officially ascribed to any party yet, so it's all still up in the air. The most popular opinion is probably that a failure to follow appropriate technical procedures on BitGrail's end opened a vulnerability which resulted in the theft.
The most compelling path for Nano holders who lost funds in the BitGrail attack might be to sign up with the anti-BitGrail lawsuit party.
Disclosure: At the time of writing, the author holds ETH, IOTA, ICX, VEN, XLM, BTC and NANO.