July 18, 2022
Consumer protection laws and cryptocurrencies
Fraud is a serious problem in the cryptocurrency space. Every year, cryptocurrency users suffer more than $20 billion in losses due to fraud in its various forms. Everyone from regulators to industry giants like Coinbase and Binance would like to put a stop to it, but so far they have made little progress.
Jurat offers unique solutions that can ensure you will not become a victim too.
Does the law prohibit cryptocurrency fraud?
Absolutely. The law applies to blockchain transactions the same as with transactions in the physical world. So, consumer protection laws give you the right to get your cryptocurrency back if someone tricks you or steals from you. The law entitles you to sue and go to court.
When a person commits fraud in a physical transaction – for example, sells you a product that they know is defective, you can file claims with a judge ranging from statutory claims, like the Deceptive Practices Acts, to common law claims like fraud and breach of contract. If the judge agrees with you, then you can get your money back and recover other damages for your loss.
Why is cryptocurrency fraud so widespread?
The problem is widespread because blockchain users are unable to enforce their rights in the same way as with physical transactions or bank payment rails like the Visa network. Chances are, the person who defrauded you is anonymous because there is no name associated with a blockchain address. Therefore you do not know who to sue. Also, there is no way for a court to order a blockchain to make a change. With a bank account, the court can order the bank president to refund your account for the stolen money. But there is no one in charge of a blockchain to refund you for stolen coins.
Because criminals can easily get away with blockchain crimes there is a lot of fraud involving cryptocurrency.
Can Jurat help enforce consumer protection laws?
Again, absolutely. Jurat evens the playing field by providing a court-authorized method to fix illegal transactions in the same way as with a bank.
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