NEWS

BitGrail Owner Ordered To Return Funds  to NANO/XRB Investors

BitGrail, NANO, Raiblocks (XRB)–In another twist on the now lengthy scandal involving the hacked cryptocurrency exchange BitGrail, Francesco Firano, the platform’s owner, has been sentenced by court of law to return investor funds–at least to the degree that he is able.

According to the Medium page BitGrailVictimsGroup, a scanned court document was uploaded on Monday, Jan. 28th, detailing the ruling and outcome that may finally bring a small amount of respite to investors affected by the high profile hack. The court sentence, which was first published on Jan. 21,  declared both Firano and his cryptocurrency exchange bankrupt, with the former being liab

While it’s exceedingly unlikely that Firano will be able to produce the full amount to cover lost funds, which was valued at $187 million worth of investor NANO during the breach in February 2018, the Italian Bankruptcy Court and authorities have already seized over $1 million in Firano’s assets, which includes his car. The Medium page post also details a positive development for affected investors, claiming that

“Millions of dollars in cryptocurrency assets have been seized from Bitgrail’s exchange accounts and moved to accounts managed by trustees appointed by the Court.”

The millions produced by Firano’s now defunct exchange and personal holdings are just a drop in the bucket for what NANO investors lost in one of cryptocurrency’s largest hacks to date. In February 2018, 17 million NANO were reportedly taken from the exchange, costing investors over $187 million. The hack also came at a bad time for cryptocurrency investors caught in the onslaught of a massive selloff, preventing affected users from cashing in and offsetting their losses.

While Firano has been in a back and forth dispute with the NANO development team over who should ultimately be responsible for the hack, the court documents provided a modicum of closure. Firano, who alleges that the NANO development team was at fault due to a security flaw in their currency, was ultimately pinned with responsibility for the hack. According to the documents uploaded,

“it was the BitGrail exchange that [because of a software flaw] actually requested to the node multiple times to allow the funds to leave the wallet.”

Firano was also criticized for keeping all of the exchanges investment funds in a hot wallet, attesting to the scrutiny by many that the owner was in over his head in terms of maintaining the platform’s security. Interestingly, the court documents reveal that BitGrail had been involved in previous hacks dating back to 2017 which Firano was also aware of, including 2.5 million stolen in July 2017 with an additional 7.5 million taken just three months later.

It took until December 2017 for Firano to respond to the situation by converting the exchange’s central wallet to a cold wallet. Prosecutors also revealed to the court that between Feb. 2 and 5th 2018–just days before publicly announcing the BitGrail hack–Firano had deposited 230 BTC into a personal account on a separate cryptocurrency exchange. The Bitcoin would have been worth over $2 million at the time.

At present, two United States law firms have filed suits against the Nano development team and BitGrail.

Michael Lavere
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Cryptocurrency Writer | Bitcoin Enthusiast | Altcoin Enthusiast Reach at: mike.ethereum.news@gmail.com
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