 
 
A United States court has ruled against a crypto enthusiast after federal prosecutors allegedly wiped a hard drive containing 3,400 Bitcoin (BTC). The case drew mixed reactions from crypto users as many referenced the estimated amount of lost Bitcoin, citing on-chain firms.
FBI Not Responsible, Court Rules
Michael Prime, the plaintiff who was convicted of identity theft, lost his recent lawsuit against the FBI over lost crypto assets. He claimed that at the time of his arrest, his hard drive, which contained 3,400 BTC, was seized and wiped by the government agency.
After his release from prison in 2022, he made formal requests for the device, but the FBI noted that it had been wiped, citing standard procedure. The Bitcoin, now worth over $345 million, sparked several community debates in recent weeks.
However, the court ruled that Prime couldn’t sue the FBI for the misplaced key because he failed to disclose, and the agency followed procedure. At the time of his arrest, Prime claimed he did not own that amount of Bitcoin. According to court records, he had previously accepted ownership of 3,500 BTC before a plea deal but changed tune afterwards.
In a financial disclosure to the government, he reported owing $200 to $1,500 worth of Bitcoin, stating that it was his remaining assets. Following the requests for the hard drive and denial due to destruction, Prime hinted that the lower figure represented the price of Bitcoin at the time and not his ownership.
 
However, the court rejected the arguments because Bitcoin traded over $10,000 multiple times in 2020.
“For years, Prime denied that he had much bitcoin at all. And bitcoin was not on the list when he sought to recover missing assets after his release from prison. Only later did Prime claim to be a bitcoin tycoon… The problem? At least three times before in his final disclosure statement, his interview at the probation office, and at his sentencing hearing, Prime had represented that he had very little Bitcoin,” the judges wrote.
Furthermore, the court rejected his argument because, even if the crypto asset existed, awarding such an equitable remedy would be inequitable, and added that his delay was unreasonable. This adds to the growing amount of lost crypto assets. Glassnode data indicates that the number of lost Bitcoin is approximately 1.46 million assets.