New York Judge Pauses $235 Billion Dormant Bitcoin Wallet Lawsuit

A New York judge has temporarily halted a controversial lawsuit seeking ownership of thousands of dormant Bitcoin wallets containing an estimated 3.8 million BTC, currently valued at approximately $235 billion. The decision delays any immediate legal victory for the anonymous plaintiffs and sets the stage for a court hearing scheduled for July 14.

Justice Kathy J. King issued the stay order on June 4, putting the spotlight on a legal dispute that could have major implications for Bitcoin ownership rights and cryptocurrency law. The lawsuit was originally filed in March by an anonymous plaintiff identified as Noah Doe, along with two corporate entities. On May 1, the claim was expanded to include 39,069 inactive Bitcoin wallets.

The plaintiffs argue that New York’s lost-and-found property laws should apply to dormant cryptocurrency holdings. Under their interpretation, unclaimed property may legally belong to the finder if the original owner fails to reclaim it. However, legal experts note that courts have never applied these rules to digital assets such as Bitcoin.

The case has drawn significant criticism. Galaxy Research disputes the plaintiffs’ valuation methods, noting that the average wallet listed in the lawsuit contains approximately 97.25 BTC, worth around $6 million at current market prices. The research firm also claims that roughly 21,900 of the wallets, containing about 1.1 million BTC, may be connected to early Bitcoin activity associated with Bitcoin creator Satoshi Nakamoto.

Further complicating the case, the first wallet named in the lawsuit reportedly contains nearly 79,957 BTC linked to the 2011 Mt. Gox hack. Since the Mt. Gox repayment process remains ongoing in Japan, ownership claims could conflict with existing legal proceedings.

The court’s decision to pause the lawsuit followed a request from New York attorney and Bitcoin holder Ian R. Cohen, who sought permission to submit an amicus brief opposing the claims. Cohen argues that Bitcoin cannot be considered abandoned property simply because a wallet has remained inactive for years. According to his filing, a dormant wallet whose private keys are securely stored remains the legal property of its owner.

He also cited a 2022 law that directs unclaimed cryptocurrency assets to the state rather than private individuals. Supporting his position, blockchain data shows that 339 wallets included in the lawsuit moved funds after blockchain notices were issued in 2025, suggesting that some owners remain active or retain control of their assets.

The plaintiffs have until July 7 to respond to Cohen’s arguments. The upcoming July 14 hearing is expected to determine whether the lawsuit proceeds with formal opposition, potentially shaping future legal standards for dormant Bitcoin wallets and digital asset ownership.