Singapore's first bitcoin trial highlights dangers of algorithmic trading

THE Singapore International Commercial Court (SICC) recently issued its judgment in the first dispute in Singapore involving cryptocurrency, namely Bitcoin (BTC) and Ethereum (ETC).

Although the dispute involved trades of cryptocurrency, the issues in this case were contractual and did not need to consider the fundamental underpinnings of cryptocurrency. Instead, this case highlights the potential dangers of algorithmic trading and the difficulties with the application of the doctrine of mistake where a contract is formed without human involvement. The BTC and ETH trades in this case were executed automatically by the respective software programs of the plaintiff, B2C2, and the defendant, Quoine.

The SICC held that to determine the state of mind of a person in a case where acts of deterministic computer programs are in issue, the relevant state of mind is that of the programmer of the software or that program, at the time the relevant program was written.