The Cryptocurrency Community: Recent high court libel action

This article examines a recent case of libel in the world of cryptocurrency.  At the start of August the High Court handed down judgment in the libel case between Craig Wright and Peter McCormack.

The Parties

The claimant, Dr Wright, is a well-known figure in the world of Bitcoin and cryptocurrency and has claimed to be Satoshi Nakamoto, the creator of Bitcoin. Mr McCormack is a blogger within the cryptocurrency community who has attracted a significant following.

Dr Wright sued over the publication of Tweets and YouTube videos by Mr McCormack, asserting that the publications alleged his claims to be Satoshi Nakamoto were fraudulent.
Following a pre-trial review in October 2021, the trial took place in May to determine the meaning of the publications, whether serious harm had been caused, and what remedies should be awarded.

The question of Serious Harm

Having initially sought to rely on the defence of truth, Mr McCormack abandoned this prior to the trial.
Following the trial, Mr Justice Chamberlain found the Tweets and videos were defamatory of Dr Wright and bore the meaning that there were reasonable grounds for questioning or inquiring as to whether the Claimant had fraudulently claimed to be Satoshi.
On the question of serious harm Dr Wright initially claimed that invitations to present papers at academic conferences had been withdrawn following the publication of the defamatory Tweets and videos. However, Mr McCormack produced evidence disputing that account.
The Court accepted the defendant’s evidence and concluded that Dr Wright’s original case and evidence had been deliberately false.

The Outcome of the trial

Nevertheless, at trial Mr Justice Chamberlain decided that each of the publications was likely to have caused Dr Wright serious harm, having considered the inherent tendency of the allegations, the significant audience of the publications and the standing of Mr McCormack in the cryptocurrency community.

Therefore, the Court ruled Dr Wright was defamed and had suffered serious harm, and judgment was entered in his favour.
However, when determining damages the Court held that having advanced a deliberately false case on serious harm it would be unconscionable for him to recover more than nominal damages. Accordingly, only £1 was awarded in damages.

This case highlights the importance of engaging with the Court honestly throughout proceedings and the consequences a claimant will face if they deliberately falsify parts of their claim.

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Taylor Hampton assists with cases of libel and slander. This article was written by Tom Wright

For more information contact Tom on 0203 143 0321