Salomon Brothers’ Initiative Deemed an Attack on Bitcoin
The initiative by the company operating under the Salomon Brothers brand to claim rights to “abandoned” bitcoin wallets through OP_RETURN transactions is both legally and technically flawed. This opinion was expressed by experts consulted by ForkLog.
According to them, the “doctrine of abandonment” is inapplicable to cryptocurrency addresses, and the idea itself contradicts the fundamental principles of blockchain.
Legal Void and Anonymity
Web3 researcher Vladimir Menaskop called the initiative illegal. He stated that bitcoin cannot be considered “national” property, and blockchain itself requires new international law, which has yet to be established.
“Is it lawful? No, because this property cannot even be verified as ‘national.’ Is it legal? No, because there must be clear and explicit consent from network participants,” he stated.
The expert added that attempting to establish jurisdiction over an anonymous owner is a direct blow to the fundamental principles of decentralization and anonymity. Any verification would force the user to reveal their identity.
Lawyer Eliza-Tatyana Baselay, commenting for ForkLog on the initiative to apply the doctrine of abandoned property to bitcoin, noted that the legality of such an approach is not straightforward and, in classical legal terms, “depends on the circumstances.”
According to her, the doctrine has historically been applied to physical objects like abandoned ships, buildings, or land plots to prevent them from falling into disrepair and occupying living space. Attempting to transfer this concept to digital assets is quite a “bold claim.”
The expert pointed out that the argument for gaining control over “dormant” bitcoins to prevent malicious activities also raises questions, as this is a law enforcement function that lies with the state, not a private company.
Even if one assumes that a court approves the application of the doctrine, significant challenges arise in the realm of substantive law.
According to her, firstly, it is necessary to prove that the bitcoins are ownerless:
“This is extremely difficult to do, as the bitcoin protocol itself, unlike a bank account, does not require mandatory regular transactions. Lack of activity is not direct evidence that the owner has lost interest in the asset.”
Secondly, Baselay pointed out the need to legally justify the selection of a specific candidate as a trustee:
“I think Salomon Brothers might use the argument of a connection through a client if [the client] is the manufacturer of the respective crypto wallets. Such a connection, in my opinion, is practically impossible to prove with decentralized storage.”
Proof Challenges and Inadequate Notification
The key issue is proving that an address is truly abandoned and not used for long-term storage. Menaskop cited personal savings from the early mining era as an example.
“Why should I transfer these funds somewhere to verify that this is not a ‘lost’ address? A dilemma arises: I transfer the funds to a new address, but where is the guarantee that due to UTXO mechanics, I won’t receive a ‘sanctions’ label?” the researcher explained.
Notification through OP_RETURN is also considered legally null by the expert. He recalled a failed attempt in South Korea to send a court decision via a transaction on the TRON network.
“Blockchain is not a messenger. A court must recognize such notification as insufficient. Not everyone can, in principle, view transactions to receive it,” Menaskop emphasized.
In conclusion, the researcher called the initiative “an act of harsh centralization,” which destroys the main principle of bitcoin: “your keys — your money.”
System Test and Salomon Brothers’ Motives
Economist-libertarian Yevgeny Romanenko sees Salomon Brothers’ actions as an attempt to test the US judicial system and “apply the rules of the old world to the new.”
In his opinion, even if the court recognizes the company’s right to the bitcoins, it will only be a record on paper, as the private keys will remain with the true owners.
“Are they hoping to ‘stake out’ these rights for the future? So that later, when these bitcoins are moved by their true owners and surface somewhere, lawyers accuse the new owners of theft? This is an attempt to seize bitcoins through the judicial system,” Romanenko suggested.
As reported by CryptoQuant, transactions involving “dormant” coins have become systemic: since 2023, the average monthly volume of transactions with “old” bitcoins has increased from 4,900 BTC to 30,700 BTC.
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