US judge orders hackers to return $1M in USDT after being served via NFT

A U.S. judge has ordered unknown hackers to repay $1 million in USDT to their victim, who served them court papers via a non-fungible token (NFT) airdrop.

Judge Beth Bloom ruled in favor of Rangan Bandyopadhyay, a Florida resident scammed in December 2021 by unknown hackers. In her ruling, the Southern District of Florida judge upheld the plaintiff’s move to serve the legal papers through NFT to the hackers.

Rangan was tricked by the hackers into linking his Coinbase (NASDAQ: COIN) wallet to a fake liquidity pool in pursuit of high yields. The hackers, with full access to the wallet, drained $971,291 worth of USDT from Rangan, and he has been pursuing them since.

Having gone to court and received summons for the unknown hackers, he faced one problem: how to serve them the court papers. He settled on using the same channel they defrauded him through the blockchain.

While still a novel means, Rangan’s case isn’t the first instance when NFTs have been used to serve court papers. Last July, the High Court of England and Wales ruled that NFTs were a legally-valid channel to serve court papers.

Around the same time, another court in New York allowed Liechtenstein-based exchange LCX AG to serve court papers to unknown hackers via an NFT airdrop.

The challenge for Rangan remains: how do you enforce a court order against anonymous hackers? With the blockchain being a global technology, there’s no guarantee that the hackers are based in the United States.

Rangan’s attorney Fernando Bobadilla is, however, confident that his client will recover the funds.

“These fraudsters are usually outfits outside of the United States, and everything that they tell the victim is a lie about their own identity. But what they can’t hide is the transfer of the funds via the blockchain. The ledger is there and they can’t hide,” he told one outlet.

“Us knowing where the crypto is sitting makes the entire collection strategy viable,” he added.

For now, the funds sit in a Binance Exchange Pool. In the past, exchanges such as Binance and Coinbase have frozen digital assets in their networks following court orders, a factor Rangan will be counting on.

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