Xrp Gets Legal Recognition As Property In India: Why This Court...

The case began when Rhutikumari, an XRP (XRP) holder, filed a petition against WazirX after the exchange froze her account containing 3,532.30 XRP worth approximately $9,400. The dispute stemmed from WazirX’s response to a July 2024 hack that led to the theft of about $235 million in assets.

To manage the losses, WazirX proposed a controversial “socialization of losses” plan, which would distribute the financial impact proportionally across all user accounts. Rhutikumari challenged the plan, arguing that it infringed on her ownership rights.

In its defense, WazirX argued that the dispute was governed by a Singapore High Court-approved restructuring plan, which outlined a three-step process for pro rata compensation to all users. The exchange argued that it does not directly own user wallets and claimed the Madras High Court lacked jurisdiction because arbitration was based in Singapore. It also added that trading and withdrawals had been temporarily paused for all users during the restructuring process.

This situation prompted the Madras High Court to rule not only on Rhutikumari’s account but also on whether cryptocurrencies like XRP qualify as personal property under Indian law.

Did you know? XRP can settle cross-border transactions in just three to five seconds, making it one of the fastest digital assets for payments.

In a significant interim ruling, the Madras High Court declared that cryptocurrencies are “property capable of being possessed and held in trust,” formally recognizing them under Indian law.

Justice N. Anand Venkatesh held that digital assets such as XRP constitute a form of property — intangible yet capable of being possessed, enjoyed and held in trust — rather than mere speculative instruments. In reaching this conclusion, he referred to Section 2(47A) of the Income Tax Act and drew from both Indian jurisprudence and international precedents, including the New Zealand case Ruscoe v. Cryptopia Ltd.

Although WazirX argued that a Singapore court-approved restructuring scheme governed the dispute, the Madras High Court disagreed. The court held that it retained jurisdiction since the petitioner, Rhutikumari, had transferred funds from an Indian bank account. It also noted that she accessed the WazirX platform from within India, creating a domestic cause of action.

As interim relief, the court prohibited Zanmai Labs, the Indian company operating WazirX, from reallocating Rhutikumari’s 3,532.30 XRP and ordered the exchange to provide

Source: CoinTelegraph