Ian Cohen Fights $238B Lawsuit Over Satoshi Bitcoin

Attorney Ian Cohen pushes back against mass Bitcoin claim

Attorney Ian R. Cohen has filed a forceful court rebuttal opposing efforts to revive a sweeping lawsuit that seeks control of thousands of Bitcoin addresses — including wallets long linked to Bitcoin creator Satoshi Nakamoto. The contested litigation targets 39,069 addresses that plaintiffs say collectively hold about $238 billion in Bitcoin (roughly 3.8 million BTC at current market levels).

Background of the lawsuit and recent filings

The suit, brought by anonymous plaintiffs using the labels ABC Company, XYZ Company and Noah Doe, argues that long-dormant, self-custodied Bitcoin should be treated as abandoned property under New York law and therefore subject to court reallocation. The complaint lists numerous well-known addresses, among them wallets historically attributed to Satoshi and the 1Feex address tied by investigators to coins stolen during the Mt. Gox breach.

Cohen sought permission to participate in the case as amicus counsel. New York Justice Kathy King issued a court-ordered stay after reviewing the matter and Cohen's request; a hearing on his amicus application is scheduled for July 14. On June 19 Cohen filed a detailed opposition to the plaintiffs' attempts to lift that stay, a filing that Galaxy Digital research head Alex Thorn highlighted in an X thread on June 20.

Legal arguments: why dormant wallets are not abandoned property

Cohen's central legal contention is that New York's lost-property rules do not extend to self-custodied Bitcoin. He argues that mere inactivity on-chain does not equal legal abandonment and that ownership of private keys — the essential control mechanism for Bitcoin — falls outside the kind of property subject to escheat under state statutes.

He also emphasizes practical and procedural problems with the plaintiffs' approach. The defendants named in the complaint are not identifiable natural persons but tens of thousands of pseudonymous Bitcoin addresses. Cohen warns that lifting the stay could permit plaintiffs to seek default judgments against these addresses without meaningful notice or opposition, effectively transferring property rights in billions of dollars of crypto without participation from the alleged owners.

On-chain evidence undermines abandonment claims

Cohen's filing challenges the factual premise that the targeted addresses are abandoned. The complaint itself, he notes, flags multiple addresses that later recorded outbound transactions, signaling that someone retained access to the corresponding private keys and moved funds.

Independent research appears to back that point. Galaxy Digital said it identified 52 named addresses that collectively moved 34,335 BTC, and that 29 of those addresses transferred 12,302 BTC after receiving notice of the lawsuit. Those on-chain movements complicate any assertion that inactivity alone demonstrates abandonment, and they undermine the plaintiffs' claim that the coins are permanently inaccessible.

Jurisdictional and policy concerns raised by industry figures

The case has drawn criticism from prominent figures across the crypto sector. Ripple's former CTO David Schwartz questioned a New York court's authority to assert control over wallets whose owners are unknown and dispersed across a decentralized network, calling the jurisdictional theory a critical weakness that could lead to people losing access to private keys and their assets.

Binance founder Changpeng Zhao has also weighed in on the broader debate about dormant Bitcoin holdings, suggesting hypothetically that wallet freezes could arise in a future migration to quantum-resistant cryptography if holders fail to migrate funds within a defined window. Zhao emphasized that any such change would require broad community consensus, not unilateral action.

Practical stakes: private keys, default judgments and asset security

Cohen's filing stresses that private keys are the sole mechanism of control over Bitcoin, and that state court doctrines for lost property were not designed to reach decentralized, self-custodied digital assets. Granting plaintiffs the relief they seek could create a precedent allowing courts to commandeer crypto assets by treating inactivity as legal abandonment.

The filing also notes the improbability that holders of the named addresses would appear in court. Without living claimants present to defend themselves, a lifted stay could result in default judgments that permanently alter ownership of high-value Bitcoin holdings.

What to watch next

The court hearing on July 14 will be the next public milestone. Observers will watch whether the judge maintains the stay and whether the amicus brief is accepted. Beyond this case, legal debates over jurisdiction, custody, and the nature of digital property will likely shape how courts approach disputes over dormant crypto wallets in the years ahead.

For market participants and custodians, the outcome has wide implications for asset security, on-chain governance and how traditional legal frameworks adapt to decentralized finance. As litigation unfolds, the crypto community and legal practitioners will be monitoring for clear principles that protect private-key holders and avoid unintended transfers of control over tokenized wealth.

This dispute underscores a broader question confronting regulators, technologists and courts: how to reconcile century-old property doctrines with the technical realities of blockchain, permissionless networks, and cryptographic key ownership.