Asters successfully represented ASK Technology Limited, a leading Hong Kong manufacturer of multi-GPU systems for mining, rendering and AI, in a dispute with a Finnish company that was resolved in Arbitration Institute of the Stockholm Chamber of Commerce. The dispute revolved around a contract for the supply of equipment for the mining of Ethereum, one of the fastest growing cryptocurrencies alongside with Bitcoin.
Asters represented the seller under the contract that provided the buyer with the necessary cryptocurrency mining equipment. However, some time after the delivery had been made, the buyer started claiming that the equipment failed to meet the quality requirements set out in the contract. In particular, the buyer alleged that the equipment's hash rate parameters are lower than agreed between the parties and thus its output of Ethereum was less than expected. Against this backdrop, the buyer sought the full repayment of the purchase price plus interest or, alternatively, the compensation for damages incurred by the delivery of defective mining equipment.
The sole arbitrator rejected all of the buyer's claims, finding that the delivered mining equipment was of contractual quality. In ruling in the seller's favor, the arbitrator accepted Asters' interpretation of both the contract and Hong Kong law (which was found to be applicable law despite the buyer's objections). Moreover, the arbitrator ordered full arbitration and legal costs of the client that were incurred during these proceedings, to be compensated by the opponents as a losing party.
"This case has served as a reminder that mining of cryptocurrencies is a complex and in a lot of ways uncertain process, the commercial viability of which depends on multiple factors, including hardware and software type and configuration, access to infrastructure, as well as the price of the cryptocurrency in volatile markets", - Kirill Sotenskiy, Sales Director Eastern Europe at ASK Technology Limited, points out. "Although the case involved advanced technical issues and complicated multijurisdictional challenges, thanks to the highest expertise of Asters team the positive result has been achieved for our company."
"The present case presented a unique opportunity for the international commercial arbitration to address the largely unexplored issues of the crypto mining process, which still remains a relatively novel activity for today's businessmen", - Markiyan Kliuchkovskyi, Partner at Asters, comments. "At the same time, the arbitrator's ruling, among other things, indicates that existing legal rules and principles are still capable of dealing with at least some aspects of such rapidly developing activities as crypto mining."
Asters team was led by Partner Markiyan Kliuchkovskyi and included Counsel Oleksandr Volkov, and Associate Mykhailo Soldatenko. Hong Kong's leading law firm Deacons was engaged as Hong Kong law expert.
Asters is the largest law firm in Ukraine with offices in Kyiv, Washington D.C., Brussels and London. Chambers Europe 2019 recognizes 19 lawyers of Asters – the largest number of the renowned practitioners in a single Ukrainian law firm.