Congress Tries to Block Claim on $64.6M of Dormant BTC with Preemption Provision

As Congress debates the CLARITY Act, a lawsuit has been filed claiming ownership of nearly 18% of Bitcoin's total supply, worth around $64.6 million.

The plaintiffs, Noah Doe and two companies, are using New York's lost-property law to claim title to 3.8 million dormant BTC. They argue that the coins should be considered abandoned property because their owners have not moved them or shown continued interest in years.

However, Section 20216 of the CLARITY Act draft proposes to preempt state and local laws that treat wallet inactivity as grounds for transferring ownership. This provision would protect self-custodied digital assets from being considered abandoned solely due to inactivity.

If this language survives Senate negotiation, it could make it difficult for claimants like Noah Doe to argue that years of silence alone are enough to transfer ownership. Self-custody advocates hope that this provision will give them greater legal protection and make it harder for others to claim title to dormant wallets based on inactivity.