Why Crypto Tracing Fails, How Expert Evidence Went Wrong, and Where the Courts Are Heading
1. Setting the Scene: From Novelty to Normality
When English courts first began grappling with crypto‑fraud, the questions felt almost metaphysical. Was Bitcoin “property” at all? If so, where was it located, and what remedies could a victim of fraud expect?
In AA v Persons Unknown [2019] EWHC 3556 (Comm), Bryan J gave the first fully reasoned judgment that treated Bitcoin as a form of property, drawing heavily on the UK Jurisdiction Taskforce’s Legal Statement and Lord Wilberforce’s well‑known criteria in Ainsworth. Cryptoassets, he reasoned, could be “definable”, “identifiable”, capable of assumption by third parties and sufficiently permanent to qualify as property. That conclusion unlocked proprietary injunctions, Bankers Trust relief and other remedies which presuppose the existence of property rights.
Shortly afterwards, in Ion Science Ltd v Persons Unknown (2020, unreported), the Commercial Court deployed that understanding in a practical fraud setting. The court granted a worldwide freezing order, proprietary injunctions and Bankers Trust relief to assist a victim of a USDT fraud, as well as permission for service out against overseas exchanges, and ultimately a third‑party debt order.
Then came LMN v Bitflyer Holdings Inc [2022] EWHC 2954 (Comm), where Butcher J made extensive Norwich Pharmacal and Bankers Trust orders against half a dozen foreign exchanges, relying on the new “Gateway 25” in PD 6B. This gateway allows service out for information orders concerning property within the jurisdiction. LMN’s own blockchain analysis was enough to persuade the court there was a “good arguable case” that stolen coins had reached those exchanges, justifying orders for KYC and transactional data to identify wrongdoers and chart the onward flow of assets.
By 2022, then, three themes had emerged. First, cryptoassets were plainly property for English law purposes. Second, information orders against exchanges were attainable, even against foreign custodians. Third, interim relief could be obtained on the back of relatively high‑level tracing analysis so long as there was a “good arguable case”.
What had not yet been properly tested was whether those same tracing techniques and analytics could survive the glare of a fully contested trial, or bear the weight of final proprietary judgments with serious consequences for third parties. That is the leap the recent cases have forced the courts to make.
2. Why Crypto Tracing Fails: Lessons from D’Aloia and Other Cases
2.1 The structure of the D’Aloia litigation
D’Aloia v Persons Unknown Category A & Ors [2024] EWHC 2342 (Ch) is the first detailed trial judgment on crypto tracing against an exchange. Fabrizio D’Aloia fell victim to a sham online trading platform, to which he transferred around £2.5 million worth of cryptocurrency, including roughly 2 million USDT. On his case, part of those tokens were later swept, through a chain of wallets and mixers, into a wallet ending 82e6 (the “82e6 wallet”) associated with a customer of the Thai exchange Bitkub.
His claim against Bitkub was framed in constructive trust and unjust enrichment. In broad terms, he alleged that Bitkub held “identifiable cryptocurrency” within a 400,000‑USDT credit to the 82e6 wallet, of which a slice represented his misappropriated tokens. The case therefore depended on convincing the court that his proprietary interest could be traced or followed into that mixed balance.
The judge approached the matter in a controlled sequence. First, he considered whether USDT was capable of being property and, if so, of being followed or traced. Second, he asked whether common law or equitable tracing rules could accommodate USDT moving through mixtures. Third, he examined whether, as a matter of fact, the claimant’s USDT had ever reached the 82e6 wallet. Only if all three stages were satisfied could Bitkub realistically be fixed with a proprietary obligation.
On the first point, the court was clear. Building on AA, the judge held that Tether tokens were personal property, even though they were neither choses in possession nor choses in action. Adopting language reminiscent of the Law Commission’s “data objects” analysis, he characterised USDT as a form of digital asset whose distinctiveness and persistence were sufficient to ground proprietary rights.
He then grappled with following and tracing in this new context. Common law tracing, he held, cannot operate through mixtures, and that well‑known limit applied as much to USDT as to conventional money. That made a proprietary unjust enrichment claim difficult: the claimant’s tokens had moved through wallets that plainly commingled assets from many victims. However, the judge was prepared in principle to treat USDT as a “persistent thing” that could be followed through a series of transactions, partly because Tether Ltd, as issuer, could in theory identify particular tokens in any wallet.
Conceptually, then, the law was elastic enough. The problem was not a lack of doctrine, but a lack of proof.
2.2 The evidential gap at the heart of D’Aloia
The claimant’s entire case on tracing into Bitkub rested on expert blockchain analysis. His expert had produced what became known as the “Arrowsgate report”, relying heavily on proprietary analytics software and presenting a sequence of visual charts purporting to show the flow of tokens from the scam platform to the 82e6 wallet.
By the time of trial, however, the methodology presented a moving target. The report described a supposedly mechanical FIFO (first‑in, first‑out) approach. But cross‑examination revealed that the expert had not in fact applied a strict FIFO rule, and in some respects had abandoned it altogether, opting instead for a more impressionistic selection of which outputs to treat as “tainted”. The judge noted that no supplemental report had been served to correct the methodology section, and no material from the software provider was produced to substantiate the claimed approach.
The court found the claimant’s expert evidence “chaotic” and, ultimately, unconvincing. On a close reconstruction of the actual on‑chain transactions, the judge concluded that there was simply no reliable basis for saying that any portion of Mr D’Aloia’s USDT had ever reached the 82e6 wallet at Bitkub. The failure was factual and evidential, not legal. The result was stark: the claimant could not establish a distinct equitable title in any part of the 400,000‑USDT credit, and therefore could not impose a constructive trust on Bitkub.
The unjust enrichment claim fared no better. While the judge was prepared to accept that, in principle, a crypto‑exchange could be unjustly enriched by receiving assets misdirected through fraud, that proposition depends on the claimant proving that his specific assets (or their traceable substitutes) had reached the defendant. Here again, the expert tracing was too fragile to carry that load.
It bears emphasis that Bitkub itself did not emerge entirely unscathed. The judgment contains pointed criticisms of its AML monitoring and its repeated tolerance of suspicious withdrawals from the customer’s account. Those findings led the court to reject Bitkub’s attempted reliance on ministerial receipt and change of position defences in principle. But because tracing into its wallets failed on the facts, those potential defences never became outcome‑determinative.
In short, D’Aloia shows that even a sympathetic court, willing to recognise crypto as property and to entertain constructive trust and unjust enrichment theories, will not stretch evidential standards to rescue a claimant from inadequate expert analysis.
2.3 Piroozzadeh and the realities of exchange custody
If D’Aloia exposes the weaknesses of poorly executed analytics, Piroozzadeh v Persons Unknown [2023] EWHC 1024 (Ch) exposes the limits of what tracing can achieve in the world of omnibus hot wallets.
The claimant in Piroozzadeh traced misappropriated USDT into accounts on Binance. His without‑notice application had successfully produced proprietary injunctions freezing tokens thought to be traceable to the fraud. On the return date, however, Binance appeared and explained the actual operation of its wallet infrastructure. Deposited Tether did not sit in neat, segregated addresses. Instead it was rapidly swept into central hot wallets through which huge volumes of client transactions passed.
Trower J discharged the injunction. He held, first, that the claimant had breached his duty of full and frank disclosure by failing, at the ex parte stage, to spell out the likely defences available to Binance, including arguments about bona fide purchaser and the impossibility of isolating his property within a constantly moving pool. Secondly – and more significantly for present purposes – the judge concluded that attempting to trace a particular victim’s USDT through such a hot wallet, nine months after the event, would be “close to impossible” and perhaps “futile”. That assessment of practical impossibility has since been cited with approval in later commentary and by the judge in D’Aloia himself.
Piroozzadeh therefore forces practitioners to confront an awkward truth. Much of what passes for “tracing” into exchanges is, in reality, tracing into very large commingled pools in which the link between an individual depositor and any given token is a matter of internal accounting rather than on‑chain distinctiveness. Without cooperation from the exchange and access to its internal ledgers, the idea that one can reliably identify “my coins” months after they have joined the stream risks becoming fiction.
2.4 LMN v Bitflyer: tracing enough for information, not for judgment
The decision in LMN v Bitflyer occupies a different place in the story. LMN, a hacked UK‑based exchange, used blockchain analytics to identify addresses at several foreign exchanges which appeared to hold the proceeds of a theft. The relief sought was not final judgment, but extensive information orders – KYC files, transaction records and the like – together with permission to serve these orders out of the jurisdiction using Gateway 25.
Butcher J accepted that the tracing evidence supplied a “good arguable case” that LMN’s assets had been transferred to wallets at the respondent exchanges. On that footing, and applying orthodox Norwich Pharmacal and Bankers Trust principles, he ordered disclosure of carefully delimited categories of information designed to help LMN locate, and ultimately recover, its digital assets.
LMN thus illustrates a lower evidential threshold. It stands for the proposition that crypto tracing, even if imperfect, can be enough to justify information relief where there is a serious issue to be tried and where the purpose of the order is to obtain better evidence. What later cases have made clear is that such “good arguable case” material is not, without more, a safe platform for final proprietary judgments.
2.5 Jones v Persons Unknown (No 2): tracing the wrong Bitcoins
The point comes into sharp focus in Jones v Persons Unknown (No 2) [2025] EWHC 1823 (Comm). Mr Jones had been defrauded of approximately 89.6 BTC between 2019 and 2020 via a sham trading platform known as ExtickPro. He later obtained freezing and proprietary injunctions, and, in 2022, summary judgment against various categories of persons unknown and against Huobi, the exchange at which a particular wallet (the “tHEL wallet”) was said to hold his stolen Bitcoin. The judgment declared Huobi a constructive trustee of 89.616 BTC, and ordered it to deliver up that amount.
Huobi chose to comply by transferring the required amount of BTC from another wallet ending RwrmV, then reimbursing that wallet by debiting the tHEL wallet. Subsequent analysis, however, revealed that the tHEL wallet did not in fact contain the fruits of the ExtickPro fraud at all. Its contents belonged beneficially to Kyrrex Ltd and its customers. In other words, Huobi had satisfied the Jones judgment using other people’s coins.
Kyrrex, understandably alarmed, brought an application under CPR 40.9, which allows non‑parties “directly affected” by a judgment or order to seek to have it set aside or varied. Kyrrex argued that it had been directly affected because the tracing evidence on which the 2022 judgment rested was flawed, and the order had led to the involuntary depletion of its assets. It sought, among other things, to be added as a defendant, to have the judgment set aside and to require the return of the 89.616 BTC to the tHEL wallet.
The Commercial Court dismissed the application. Applying CPR 40.9, the judge accepted that Kyrrex had been affected but concluded that the “direct” cause of its loss was Huobi’s choice of how to comply with the order, not the judgment itself. There had also been a substantial delay: some two years had passed between judgment and Kyrrex’s application. The court emphasised the importance of finality and the prejudice that would be caused by reopening a concluded action on which Mr Jones had relied.
The result is sobering. Mr Jones keeps the fruits of his judgment. Kyrrex is left, at least as between itself and the claimant, without redress. And the underlying tracing error remains a matter of regret rather than correction. Academic and practitioner commentary has been quick to highlight the systemic danger: if flawed blockchain analytics can support proprietary judgments against exchanges, innocent custodial clients may find themselves financing other people’s recoveries.
2.6 Common failure modes
Taken together, these cases expose recurring patterns in failed or problematic tracing.
First, there is a basic failure to appreciate how exchanges actually hold assets. Deposit addresses are often treated as if they were self‑contained wallets belonging to particular customers, when in reality they are pipes feeding a constantly churning reservoir of pooled assets. Once tokens enter that pool, on‑chain data alone will usually not tell you whose beneficial interest attaches to which part of the balance at any given time. Piroozzadeh and Jones both illustrate the danger of ignoring this custodial reality.
Second, there is an overconfidence about what can be achieved after extensive mixing and delay. Trower J’s observation in Piroozzadeh that tracing through a hot wallet with massive turnover months after the event may be “possibly impossible” has been picked up by commentators and by the judge in D’Aloia. Where the facts resemble a swirling digital soup, a report which nonetheless confidently identifies “your” coins risks being more narrative than analysis.
Third, there is a tendency to blur the boundary between legal and technical tracing. Blockchain software may be able to follow flows of value from one address to another. But the legal question is whether a particular claimant’s proprietary interest can be traced or followed consistently with the rules of common law and equitable tracing, including their limitations on mixtures. The judgment in D’Aloia is at pains to separate those strands, insisting that the digital mechanics of a transfer cannot be allowed to bypass the conceptual architecture of property law.
Finally, and perhaps most importantly, there is the human factor: experts whose enthusiasm for their client’s cause, or for the power of their tools, leads them to overstate what can responsibly be said. It is to that phenomenon that we now turn.
3. The Rise of Flawed Expert Evidence in Crypto Litigation
3.1 A new species of expert
Crypto disputes have created an eager market for “blockchain intelligence”. Specialist firms offer to trace stolen tokens, cluster wallets, attribute addresses to exchanges or mixers and produce visually striking charts, often supported by proprietary heuristics and risk scores. Many of these providers are technically sophisticated and genuinely independent. Others behave less like forensic experts and more like claimant‑side investigators whose business model depends on generating recoveries.
The courts now find themselves assessing a new species of expert. These witnesses sit somewhere between a conventional accountant, a computer scientist and a digital detective. They often arrive with complex software and canned methodologies, but without the long‑established forensic traditions and norms that govern, say, handwriting experts or chartered engineers.
The recent cases suggest that judges are increasingly sceptical of expert evidence that is glossy on the surface but thin underneath.
3.2 D’Aloia: methodology under the microscope
The treatment of expert evidence in D’Aloia is striking precisely because the court was otherwise sympathetic to the legal structure of the claimant’s case. As later case notes explain, the judge accepted that the original fraudsters held the USDT on constructive trust for the claimant from the moment of misappropriation, and that rescission of the scam contract could, in principle, generate proprietary rights. In that respect, the decision is doctrinally favourable to victims of crypto‑fraud.
Yet the expert evidence fell apart. The “Arrowsgate” analysis purported to apply FIFO to identify the fraction of a 400,000‑USDT credit that represented Mr D’Aloia’s tokens. In cross‑examination it became clear that the report’s description of the methodology was inaccurate: strict FIFO had not been consistently used, no supplemental report had been served to correct the description, and there was no material from the software provider to show what algorithms or grouping rules had actually been applied.
In academic commentary, the case has been described as a “cautionary tale in expert dependence”. The court was effectively asked to accept a chain of proprietary reasoning that ran: the claimant’s USDT went to wallet A; from wallet A to mixer B; from mixer B to omnibus wallet C; and from omnibus wallet C, in part, to the 82e6 wallet at Bitkub. Each stage depended on the accuracy of the expert’s identification and treatment of transactions out of large mixed pools. When that methodology proved opaque and internally inconsistent, the judge had little difficulty finding that the factual tracing had simply not been proved.
One sees here, in embryo, the evidential standards that will govern crypto litigation going forward. It is no longer enough for an expert to append transaction lists and heat maps and assert that “on the balance of probabilities” the claimant’s coins ended up at a given address. The court will expect a clear, replicable explanation of how competing paths were analysed, how mixtures were treated, what assumptions were made and what margin of error the method entails.
3.3 Jones: when bad tracing harms strangers
If D’Aloia shows expert evidence failing to get a claimant over the line, Jones (No 2) shows how flawed tracing can damage those who were never parties to the original proceedings.
As the HFW case update makes clear, the original judgment in Jones was itself based squarely on blockchain analytics said to show that Mr Jones’s 89.616 BTC had reached the tHEL wallet at Huobi. That tracing underpinned both the proprietary injunctions and the summary judgment declaring Huobi a constructive trustee.
Only later did fresh experts, instructed by Kyrrex, demonstrate that the original analysis was wrong: the Bitcoin in the tHEL wallet had nothing to do with the ExtickPro fraud, and belonged instead to Kyrrex and its clients. By then, however, Huobi had already satisfied the judgment by transferring a matching quantity of BTC and reshuffling its internal positions.
Scholars such as Kelvin Low have seized on the case as an example of what might be called “proprietary overreach”: courts using proprietary remedies against exchanges on the basis of uncorroborated analytics, without a full appreciation of the risk to innocent account‑holders whose assets may be conscripted to satisfy someone else’s claim.
In Jones (No 2) itself, the judge did not accept that Kyrrex met the strict test under CPR 40.9 and placed significant weight on delay. But in doing so, he recognised explicitly that digital asset litigation involving persons unknown and omnibus custodians raises novel questions about who really bears the loss when tracing goes wrong. The matter was ultimately resolved as a question of procedure and finality rather than the merits of the tracing.
3.4 Recognising “bad” crypto expert evidence
Certain warning signs recur across the case law and commentary.
One is opacity. Reports frequently refer to clustering algorithms, labelling databases and risk scores without explaining how they work or how reliable they are. Where those systems are proprietary, the temptation is to hide behind confidentiality. That may be commercially understandable, but it is difficult to reconcile with the requirements of CPR 35 and the court’s need to scrutinise a methodology that may determine the fate of millions in digital assets.
Another is selective narrative. Tracing reports sometimes read less like neutral analyses and more like advocacy documents, foregrounding flows that support the claimant’s story while downplaying or ignoring alternative routes the tokens might have taken. The criticism of the Arrowsgate report in D’Aloia sits squarely in this territory.
A third is a failure to distinguish attribution from tracing. An expert may be very sure that a particular cluster of addresses is “associated with exchange X” or “linked to mixer Y”, because many transactions and heuristics support that label. But that is not the same as saying that a particular victim’s proprietary interest can be traced into those clusters in accordance with equitable rules. It is this distinction that often disappears in glossy “crypto intelligence” dossiers, and which judges are now learning to insist upon.
Finally, there is the question of independence. Some experts appear in case after case on the same side of the market, often marketing their services on the basis of previous “recoveries”. That, in itself, is not disqualifying. But when combined with opaque methods and a tendency to overstate certainty, it risks undermining confidence in the whole enterprise of blockchain forensics.
3.5 Instructing and managing experts
From a litigation perspective, the lessons are practical as well as conceptual.
Counsel and solicitors must interrogate proposed methodologies at the outset, not at trial. It is essential to understand how an expert proposes to handle mixtures, what assumptions will be made when tokens pass through hot wallets, whether alternative paths will be explored and how sensitive the analysis is to labelling errors. Open‑ended questions such as “Can you trace my coins into this wallet?” should be replaced by more disciplined discussions about what the data can and cannot show.
Equally, parties should insist on transparency and replicability. A report that cannot, in principle, be reconstructed from public blockchain data using clearly explained rules will be vulnerable to attack. Where proprietary software is involved, the expert must, at the very least, be able to describe the categories of heuristics used, their known error rates and the degree of human judgment involved in interpreting outputs.
And above all, experts in crypto disputes must embrace, rather than resist, the traditional disciplines of CPR 35. That means setting out instructions, facts, assumptions, and limitations candidly; making clear that their duty is to the court; and being willing to concede uncertainty where the data simply does not support a confident conclusion.
4. Raising the Bar: How English Courts Are Shaping Blockchain Analysis
4.1 From “good arguable case” to proof on the balance of probabilities
In the early cases, the courts’ main concern was whether to grant interim relief. In AA, Ion Science and LMN, the question was essentially whether there was a serious issue to be tried and a good arguable case that the claimant had been defrauded of cryptoassets traceable to identifiable wallets or exchanges.
By contrast, D’Aloia and Jones (No 2) are about final outcomes. In D’Aloia, the court was asked, after a full trial, to make definitive findings about whether a proprietary interest had reached a Bitkub wallet and to impose a constructive trust accordingly. In Jones (No 2), the question was whether a final judgment based on earlier tracing should be reopened at the behest of a third party.
The evidential standard is, of course, the familiar civil one: proof on the balance of probabilities. But these cases illustrate that what counts as sufficient proof in a digital tracing context is evolving. Courts now expect greater analytical discipline at trial than at the ex parte stage. A tracing exercise that passes muster for an interim freezing order may not satisfy the more rigorous scrutiny required for final declaratory or proprietary relief.
4.2 Doctrinal housekeeping: following, tracing and mixtures
D’Aloia also plays an important doctrinal role. The judgment takes some of the Law Commission’s abstract work on digital assets and grounds it in the concrete problem of following and tracing USDT.
Several points emerge.
First, the judge insists on keeping following and tracing distinct. Following is appropriate where the same asset is later found in someone else’s hands. Tracing applies where the claimant’s asset is exchanged for something else: different property representing the old. USDT, though digital, can be viewed as a persistent asset capable of being followed so long as it remains recognisably the same token.
Second, common law tracing through mixtures is not permitted, and the court declined to abolish that distinction merely because the asset was a stablecoin rather than cash in a bank account. As Clifford Chance’s briefing notes, this was fatal to any attempt to run a purely common law proprietary restitution claim through a series of mixed wallets.
Third, the judgment suggests that, in appropriate cases, one might rely on following rather than tracing, particularly where an issuer such as Tether can, at least in principle, identify individual tokens in particular wallets. That line of thought gestures towards a world in which additional data from issuers or custodians could reinforce or contradict blockchain analytics.
The key point is that the “crypto” label does not entitle litigants to ignore the underlying structure of English property law. The familiar rules on mixtures, equitable tracing and constructive trusts still apply, albeit in a novel factual setting.
4.3 Procedural discipline: disclosure, injunctions and third‑party rights
The trilogy of Piroozzadeh, LMN and Jones (No 2) also illustrates a tightening of procedural expectations.
In Piroozzadeh, the court discharged a proprietary injunction at the return date partly because the claimant had not discharged his duty of full and frank disclosure when applying without notice. He had failed to inform the court of the practical difficulties Binance would face in isolating his claimed USDT within its hot wallets, and of the potential defences available to Binance as a good‑faith custodian. The message is clear: crypto claimants are not permitted to gloss over the structural features of exchange custody when seeking powerful interim relief.
In LMN, by contrast, the court granted wide‑ranging disclosure orders but was careful to confine them to information genuinely necessary to identify the wrongdoers and trace stolen assets. The judgment is now widely cited as a template for the proportionate use of Gateway 25, with careful emphasis on the need to balance the interests of victims against the confidentiality owed to other customers.
In Jones (No 2), the procedural issue was whether a non‑party who had suffered loss because of flawed tracing could intervene after the fact. Although Kyrrex’s application failed on delay and causation, the court’s detailed engagement with CPR 40.9 demonstrates a growing awareness that crypto judgments can have significant ripple effects beyond the immediate parties.
Collectively, these decisions signal that the Commercial Court expects sophisticated conduct from both sides: careful presentation of material on ex parte applications, tightly drafted information orders, and prompt challenge where third‑party rights are implicated.
4.4 A technically literate bench
Another notable development is the increasing technical literacy of the judges. Recent judgments refer comfortably to address clustering, hot wallets, internal ledgers, stablecoin issuance mechanics and the broad outlines of blockchain analytics.
That matters in two ways. First, it reduces the risk that impressive graphics or novel jargon will overwhelm judicial instincts. Judges are now more willing to ask how an expert got from raw transactional data to a conclusion about proprietary entitlement, and to expose gaps in that reasoning. Second, it raises the bar for experts and advocates, who can no longer assume that a high‑level narrative about “funds being washed through a mixer and emerging at X exchange” will go unchallenged.
There is also a discernible feedback loop between the courts and the Law Commission’s ongoing work. The final report on digital assets and subsequent academic literature on tracing and following cryptoassets are increasingly cited in practice. Judges are, in effect, co‑developing the law of digital property alongside scholars and law reform bodies, but doing so with the unforgiving factual canvas of real‑world fraud.
5. Practical Consequences for Litigators and Exchanges
For claimants and their advisers, the central lesson is that crypto tracing is not an evidential shortcut. It is the case. A promising legal theory – unjust enrichment, constructive trust, knowing receipt – will fail if the factual tracing into the defendant’s hands cannot be proved with robust, transparent analysis. D’Aloia is testament to that reality.
This in turn means that litigation strategy should be calibrated to the strength of the available evidence. Where tracing into an exchange’s wallets is inherently speculative because of long‑running mixing, or because the relevant hot wallet has handled vast volumes after the fraud, it may be wiser to focus on personal claims, regulatory strategies or claims against intermediaries whose negligence or breach of mandate can be demonstrated without reconstructing the digital flow of assets.
For exchanges and custodians, the cases encourage proactive engagement rather than passive resistance. LMN shows that where exchanges engage with the court, information orders can be framed in ways that reduce practical burden and respect customer confidentiality, while still assisting victims. Piroozzadeh and Jones show that failing to educate the court about the true nature of custodial structures may lead to orders based on misunderstanding – with the risk that exchanges end up choosing between defying the court and depleting innocent customers’ accounts.
There is also a compliance dimension. The more reliable an exchange’s internal records and AML systems, the easier it will be to demonstrate which customer bore which risk at which time, and to raise defences such as bona fide purchaser or change of position. At the same time, better records can make it simpler for claimants to prove tracing into the exchange. The law is thus quietly nudging major platforms towards institutional maturity: robust systems, clear terms and transparent responses to court orders.
6. Conclusion: Crypto Tracing as Ordinary Evidence
The early wave of English crypto cases showed courts willing to innovate. Bitcoin and Tether were recognised as property; persons‑unknown defendants could be sued; exchanges abroad could be compelled to give information; service could be effected by unconventional means. That phase was conceptually important and practically helpful.
The more recent phase, exemplified by D’Aloia, Piroozzadeh, LMN and Jones (No 2), is more prosaic but no less significant. It is about evidence. Crypto tracing is no longer a magical art; it is simply a form of technical evidence that must withstand the same scrutiny as any other. Experts must explain what they have done. Judges will ask whether their conclusions follow from their methods. And parties will live, or lose, by the quality of the analysis they present.
From a barrister’s perspective, the direction of travel is welcome. Victims of crypto‑fraud are not being turned away. On the contrary, the courts are steadily refining the tools – information orders, constructive trusts, unjust enrichment – by which such victims can seek redress. But sympathy will not make up for weak tracing. The future of crypto litigation will belong to those who can marry doctrinal rigour with genuinely robust, transparent blockchain analysis.
Crypto Lawyer 