New York Judge Pauses Lawsuit Over Dormant Bitcoin Wallets

A New York Supreme Court judge has paused a lawsuit seeking ownership of 39,069 dormant Bitcoin wallets. The stay blocks plaintiffs from pursuing a fast default judgment before a July 14 hearing. The case (ABC Company, XYZ Company and Noah Doe v. John Does 1–39,069) tests whether New York’s lost-and-found style property law can apply to dormant Bitcoin wallets and the BTC tied to public addresses. Plaintiffs argue they can obtain a declaratory judgment naming themselves as owners, even though they do not control the private keys required to move BTC. Noah Doe says he identified inactive wallets, delivered USB drives with addresses to the NYPD, attempted to notify potential owners, and later assigned most claims to two Wyoming LLCs. A proposed amicus brief challenges the legal theory, arguing that a public Bitcoin address is not “found property” and that knowing an address is not possession of Bitcoin. It also claims a court order cannot substitute for the cryptographic control needed to sign transactions. New evidence also weakens a blanket “dormancy = abandonment” narrative: one named address moved about 35.55 BTC after receiving notice of the lawsuit. Traders should expect limited immediate price impact on BTC, but this dispute highlights a recurring legal risk for custody-adjacent services and for any future attempts to treat dormant Bitcoin wallets as claimable assets under state frameworks.