Cryptocurrency & Digital Assets
Digital assets – including stablecoins, blockchain infrastructure, and cryptocurrency exchanges – are playing an increasingly important role in financial markets across Australia, Singapore, and the broader Asia-Pacific region. As regulators such as the Australian Securities and Investments Commission (ASIC), the Australian Transaction Reports and Analysis Centre (AUSTRAC), the Council of Financial Regulators (CFR), and the Monetary Authority of Singapore expand oversight of stablecoins, payment systems, and digital asset markets, disputes, investigations, and enforcement actions are likely to grow in both scale and complexity.
Brattle’s internal and affiliated experts combine extensive financial markets expertise with sophisticated knowledge of blockchain technology, stablecoins, and crypto assets and their derivatives to deliver rigorous economic analysis and expert testimony before courts, arbitral tribunals, and regulatory bodies. We assist law firms, industry and market participants, and regulators in high-stakes matters involving market structure, trading conduct, valuation, and damages.
Our recent work includes economic analysis of stablecoins, payment systems, and cryptocurrency exchanges; valuation and liquidity analysis of crypto assets and their derivatives, including under stressed market conditions and in bankruptcy; and analysis of large, complex transactional datasets. Brattle’s consultants have addressed economic questions in matters involving alleged market manipulation, crypto asset misappropriation, trading abuses, fraud, asset tracing, valuation, cross-exchange arbitrage, decentralized finance (DeFi) protocols, initial coin offerings (ICOs), and initial exchange offerings (IEOs), as well as tax considerations related to staking and mining activity.
Representative Engagements
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Crypto Asset Tracing in Allegedly Fraudulent ICO
The DOJ hired Brattle to investigate and trace asset flows associated with a fraudulent initial coin offering (ICO). The Brattle team acquired and analyzed cryptocurrency transaction data to trace ETH flows through a web of on-chain routing addresses intended to obscure the flow of funds raised from investors.
Brattle experts identified the destination addresses of the ICO investor funds, tabulated off-chain cryptocurrency exchange conversions to fiat currency, and identified subsequent fiat currency distributions to bank accounts.
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International Arbitration Involving Crypto Agreement
In an ICC International Court of Arbitration dispute over a sponsorship agreement between a Singapore-based crypto platform and Atletico Madrid, a Brattle expert provided testimony regarding the global crypto market disruption that occurred in 2022.
The platform sought to exit a multi-year sponsorship agreement with Atletico Madrid on the basis of the unprecedented and unforeseen economic disruption in the crypto industry. The expert’s testimony focused on market expectations prior to the agreement and the severity of conditions after.
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FTX Bankruptcy
A Brattle expert provided economic analysis and expert testimony in the FTX Trading Ltd. Chapter 11 proceedings in the US Bankruptcy Court. The analysis involved the estimation of customer claims associated with holdings of certain cryptocurrency tokens at the time of FTX’s bankruptcy filing. The expert was asked to evaluate and respond to an analysis of the appropriate asset liquidation discount to be applied to the token holdings. Given a concentrated position, an orderly liquidation would be expected to exert downward pressure on prices, necessitating an adjustment to observed market prices to reflect the expected price impact.
As part of the analysis, the Brattle team conducted an independent assessment of market liquidity and trading dynamics in the tokens across both spot and derivatives markets. This included evaluating the role of perpetual futures markets as a significant source of liquidity in cryptocurrency markets and assessing the implications of incorporating futures trading into the price impact framework. Our work highlights the importance of accounting for all relevant trading venues and instruments when assessing price impact and liquidation costs in digital asset markets. Learn more about Brattle’s work on the matter here.
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Event Study of Digital Assets
Brattle was engaged to support a testifying expert addressing whether and to what extent the price of a cryptocurrency reflected information about the actions and disclosures of its issuer, rather than broader market forces. The expert conducted a comprehensive empirical analysis of the cryptocurrency’s price behavior using various event study models, adapting them for the unique features of digital asset markets.
This work included identifying and classifying hundreds of issuer-related news events, constructing multiple econometric models of expected returns (with controls for major crypto assets such as Bitcoin and Ether), and testing for statistically significant abnormal price movements around those events. The analyses performed by the Brattle team included correlations with broader crypto market factors and robustness of findings across model specifications, quantifying the economic significance of issuer-driven price effects.
Contact Our Experts
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Principal
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San Francisco
Mr. Gkatzimas specializes in financial markets disputes related to trading, valuing, and investing in securities and portfolios across asset classes, including digital assets.
