New York Lawsuit Seeks Title to $293 Billion in Dormant Bitcoin Under Lost Property Law

A lawsuit filed in New York Supreme Court on May 1, 2026, is seeking to establish legal ownership of 39,069 long-dormant Bitcoin addresses, a trove of digital assets currently valued at approximately $293 billion. The novel case, brought by a pseudonymous plaintiff known as “Noah Doe” and two affiliated Wyoming LLCs, argues that these inactive digital wallets should be classified as “abandoned property” under a state law originally designed for tangible lost-and-found items.

The complaint represents what is believed to be the first attempt in the United States to claim title to cryptocurrency using a lost-property statute. If successful, the case could set a far-reaching precedent for digital asset ownership, impacting everything from estate planning for cryptocurrency holders to compliance procedures for financial institutions and exchanges.

The legal foundation for the claim is New York Personal Property Law Article 7-B, a statute that outlines the process for a finder of lost property to eventually gain legal title. The plaintiff contends that dormant Bitcoin addresses, which the original owners may have lost access to due to forgotten passwords or damaged hardware, are legally equivalent to a physical wallet found on a sidewalk.

According to court filings, Doe claims to have discovered the addresses between December 2024 and April 2025 using a proprietary algorithm designed to identify wallets that had been inactive for at least five years. Following the procedures laid out in the statute, the plaintiff reported the findings to the New York Police Department’s 17th Precinct by delivering USB drives containing the lists of wallet addresses. The complaint states that after a designated period, the police returned the drives.

A central and highly contentious element of the plaintiff's argument is the valuation of the property. The lawsuit includes an opinion from an unnamed expert who valued each dormant address at less than $10 “as is” at the time it was found. This valuation is based on the premise that without the private keys, the ability to recover the Bitcoin within the wallets is highly uncertain, making the addresses themselves nearly worthless. This specific valuation is a critical legal maneuver, as it places the addresses under Section 257(2) of the property law. This section provides the fastest possible path to ownership, vesting title in the finder just one year after the find date and bypassing the multi-year holding periods required for more valuable property.

Based on this timeline, the lawsuit asserts that legal title to the 3.8 million BTC contained in the wallets vested in Noah Doe across three dates: December 26, 2025, March 31, 2026, and April 14, 2026.

The plaintiff’s legal team also claims to have made extensive efforts to locate the original owners. According to the complaint, they engaged a “strategic consultant” and a blockchain expert to review the wallets and assist with a plan to contact any potential owners. The expert reportedly confirmed that the wallets exist on the blockchain, contain digital assets, and have been inactive for a minimum of five years.

This case challenges New York’s existing legal frameworks for digital and abandoned assets. The state’s “BitLicense” regulation, enacted in 2015, already treats cryptocurrency as a form of property. Furthermore, New York’s Abandoned Property Law (APL) provides a mechanism for property, including financial assets, that has been dormant for a specified period (often five years) to be turned over to the state comptroller in a process known as escheatment. The lawsuit filed by Doe attempts to use a different statute to establish a private claim to these assets before they could potentially be claimed by the state.

This case highlights the growing tension between old laws and new technologies. The core question for the court will be whether a digital address, which is essentially a string of data, can be considered “lost property” in the same way as a physical object. The outcome will be scrutinized by legal experts, crypto investors, and regulators, as it could create a new pathway for claiming billions of dollars in dormant digital assets across the globe.

In our experience, this lawsuit is a stark reminder of the unique risks associated with digital assets. While the legal theory is novel, the underlying problem is not: many individuals and businesses hold significant value in cryptocurrency without adequate protocols for access, recovery, or succession. The potential for an asset to become “lost” due to a forgotten password or a failed hard drive is a tangible threat that traditional asset management often overlooks. This case underscores the urgent need for robust financial risk management strategies tailored to the digital age. Proper planning involves not just investment choices, but creating resilient systems for asset custody, documentation, and transfer to prevent them from becoming legally vulnerable or permanently inaccessible. For businesses navigating these complex issues, the advisory team at C&S Finance Group LLC can help design and implement these critical safeguards. Contact us at csfinancegroup.com to learn more.

The cryptocurrency industry and legal observers will now watch closely as the New York Supreme Court weighs this unprecedented case. Its initial rulings on whether the lawsuit can proceed will signal how the judiciary may adapt long-standing property principles to the intangible, decentralized world of digital currency. The decision could also prompt state and federal lawmakers to draft new legislation that explicitly defines the status of dormant or abandoned crypto assets.