THE AUTHOR:
Chris Lin, Valuation Manager at Interpath
This article was featured in Jus Mundi‘s 2025 Arbitration Year in Review, an annual publication analyzing arbitration developments across 40+ jurisdictions on 6 continents. This edition brings together young practitioners and senior experts to capture the year’s most significant legislative reforms, enforcement trends, and institutional innovations.
Navigating Crypto Disputes: Legal Framework, Emerging Regulation & Valuation Challenges
Cryptoassets in Arbitration
As cryptoasset markets expand, disputes over digital assets have increased, typically involving fraud, misrepresentation, platform failures, or contract breaches. With evolving exchange practices, rising requirements for expert knowledge, and continual regulatory change, arbitration is rapidly becoming the favoured avenue for resolving disputes across this complex and globalised industry. Key reasons include:
- Jurisdictional Neutrality: Cryptocurrency transactions often span multiple jurisdictions, creating uncertainty in litigation. Arbitration allows parties to select a neutral seat and governing law, reducing unpredictability.
- Confidentiality: Given the sensitivity of digital asset holdings, arbitration’s confidentiality is attractive compared to public court proceedings.
- Technical Expertise: Arbitrators can be chosen for their understanding of cryptoasset technology. Experts with specialised knowledge of blockchain and cryptocurrency can assist arbitration tribunals in interpreting technical and factual issues.
- Flexibility and procedural autonomy: Parties can design a process that suits the complexity of cryptoasset disputes including accelerated timelines, virtual hearings and tailored disclosure requirements.
- Speed and efficiency: Cryptoasset markets move quickly, and urgency is often required (as in AA v Persons Unknown & Ors, Re Bitcoin, [2019] EWHC 3556). Arbitration often provides a faster resolution and a streamlined procedure.
- Enforceability of awards: Unlike court judgements, arbitral awards are globally enforceable, less vulnerable to jurisdictional challenges, and recognised even when crypto laws vary between countries.
English law supports arbitration even in complex cryptoasset disputes. In Grosskopf v Grosskopf & Ors [2024] EWHC 291, the court confirmed that seeking remedies beyond a tribunal’s powers does not render a dispute inarbitrable.
Changes in UK Regulation
The legal landscape for cryptoassets is rapidly changing. The United Kingdom (“UK”) has moved from a fragmented approach to a comprehensive regulatory regime through the Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025. Key developments are as follows.
FCA Draft Framework
The Financial Conduct Authority (“FCA”) published its draft rules for regulating cryptoasset activities on 17 September 2025, aiming to apply comparable standards to those governing traditional financial services (the “Draft Framework”).
Under the Draft Framework, firms operating cryptoasset trading platforms, providing custody services, issuing stablecoins, or engaging in lending, borrowing, and staking will require FCA authorisation. The proposals also extend the FCA Handbook requirements, such as governance, operational resilience, and financial crime controls, to cryptoasset firms.
In addition, the FCA is consulting on measures to enhance market integrity, including admission and disclosure standards for cryptoassets and a market abuse regime tailored to digital markets. Prudential requirements for stablecoin issuers and custodians are also under consideration, alongside potential application of the Consumer Duty to cryptoasset businesses.
While the framework may lead to greater consumer protection and market confidence, it also introduces higher compliance burdens and capital requirements, which may challenge smaller businesses and create new compliance related disputes.
Property (Digital Assets) Bill
The Property (Digital Assets) Bill was introduced to Parliament on 11 September 2024, and seeks to enhance legal clarity around the treatment of digital assets in response to the Law Commission’s recommendations in 2023. It explicitly states that Digital Assets (e.g. cryptocurrencies, tokenised representations of real-world or financial assets, and other blockchain-based instruments) can be considered as personal property. The Bill received Royal Assent on 2 December 2025.
This develops and formalises the precedent set in Director of Public Prosecutions v Briedis [2021] EWHC 3155 (Admin), where the High Court determined that cryptocurrency falls within the definition of property under the Proceeds of Crime Act 2002 s.316(4).
The Bill will strengthen legal protections for digital asset owners while providing clearer guidance for courts and tribunals in resolving disputes over digital holdings. Hong Kong is a leading venue for cryptocurrency-related disputes, partly due to its recognition of cryptocurrency as property under Hong Kong law. As the UK is expected to adopt a similar approach, this could make it an increasingly attractive jurisdiction for resolving digital asset disputes.
Valuation Challenges in Expert Evidence
The nature of cryptocurrency-related disputes introduces new valuation challenges and technical complexities that extend beyond traditional financial modelling. These valuation intricacies raise significant procedural complications, requiring tribunals to provide clear directions on methodology, disclosure, and the timing of updates to ensure fairness and consistency in the arbitration process.
Expert Evidence in Cryptoasset Arbitration
Guidance from the Ciarb (Chartered Institute of Arbitrators) emphasises that an expert’s overriding duty is to assist the tribunal, not the party who appointed them. Although this is already considered as best practice, tribunals have been critical of expert witnesses who do not expressly acknowledge Ikarian Reefer guidance.
A procedural implementation of further guidelines arising from the Ciarb Expert Witness Evidence Project may result in explicit directions on the scope and format of expert evidence, together with protocols that establish expert evidence as a shared responsibility among the parties, their counsel, and the tribunal. This highlights that arbitrators with true expertise in the sector may be needed for part of the panel.
Volatility of Cryptocurrency Results in High Variability in Quantum of Damages
A recent arbitration case, in which the author provided expert evidence, highlighted that selecting the date for calculating cryptocurrency denominated damages is crucial, as price volatility in the sector can greatly alter the amount awarded.
In this case, lost profit was calculated for a bitcoin mining business expressed in bitcoins, using a Mathematical Formula less the associated electricity costs.
Applying the bitcoin price at the date of award resulted in an award greater than three times what would have been calculated using the bitcoin price at the date of the breach. Notably, the expert report was filed approximately six months prior to the hearing, such that the quantum of the claim was highly sensitive to bitcoin’s price movements after the evidence was submitted.
The party’s business model involved holding all mined bitcoin in anticipation of a significant price increase. Accordingly, the authors’ team concluded that any award should be expressed in traditional monetary terms, using the bitcoin price as at the date of the award, less the associated costs of electricity.
The Tribunal agreed with this approach and awarded damages consistent with the financial model based on the bitcoin price as at the date of the award.
The inherent volatility of cryptocurrency assets often compels tribunals to mandate periodic valuation updates to safeguard accuracy and the integrity of the claim quantification. Nevertheless, such requirements generate added costs, thereby producing a procedural dilemma that balances precision against efficiency.
Conclusion
Sections 1 and 2 address distinct developments in 2025 that are relevant to English-seated and English law governed arbitrations. The reforms to the AA 1996 refine the approach to court challenges following a tribunal’s jurisdictional determination, including limits on new grounds and evidence and greater clarity as to the range and sequencing of remedies available to the court. Section 2 considers the evolving landscape for cryptoasset-related disputes and the implications for arbitration practice, including the growing body of legal and regulatory clarification affecting digital assets and practical issues that frequently arise in arbitration, particularly valuation methodology, volatility, and expert evidence.
Taken together, these developments provide a concise procedural and substantive snapshot of how English arbitration and English law have continued to evolve in 2025 in response to both established jurisdictional issues and the increasing prominence of digital-asset disputes.
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ABOUT THE AUTHOR
Chris Lin is a Manager at Interpath based in London with over six years of valuation experience. Prior to this, he worked in the BDO valuation team in London and has a BSc (Hons) in mathematics and statistics from Loughborough University. He has extensive dispute valuation experience for litigation and arbitration matters, supporting clients at mediations, arbitration hearings, and trial proceedings. He has been involved in over 15 expert witness valuations across multiple industries, including cryptocurrency, technology, financial services, consumer goods, healthcare, and manufacturing. He also has experience providing valuations for commercial purposes, including transaction support and restructuring negotiations.
*The views and opinions set forth herein are the personal views or opinions of the authors; they do not necessarily reflect views or opinions of the firms with which they are associated, and views or opinions of Daily Jus, Jus Mundi, or Jus Connect.
