In da Silveira, Virgilio Tarrago and another v Hashstacs Pte Ltd and another [2025] SGCA(I) 3, the first published case of a crypto-token (specifically, utility tokens) mis-selling claim before the Singapore Courts, the Court of Appeal dismissed an appeal against the decision of the Singapore International Commercial Court Judge (“Judge“), affirming the Judge’s dismissal of the appellants’ claims in fraudulent and/or negligent misrepresentation. The Court considered whether the statements could be attributed to the alleged maker, and whether they constituted representations of fact.
The appellants were the claimants in a misrepresentation claim instituted against the first respondent. The alleged misrepresentations stemmed from two sources: (i) a Whitepaper published in relation to a blockchain technology project, and (ii) a Website which was a product launching page of the project. The appellants brought a claim for deceit and negligent misrepresentation, submitting that the first respondent made fraudulent or negligent misrepresentations. The Judge dismissed the claims in fraudulent and negligent misrepresentation, and the appellants appealed.
The Court dismissed the appeal, holding that the appellants had failed to prove that the first respondent was either the maker of the pleaded representations or had adopted and ratified their contents as its own.
- Regarding the Whitepaper representations, a reasonable person would not conclude that the first respondent was the maker of the Whitepaper representations or that it was adopting the contents of the Whitepaper representations.
- The contents of the Whitepaper made no mention of the first respondent, instead identifying the first respondent’s parent companies. The first respondent’s role in relation to the Whitepaper was limited, and everything it did in connection with the Whitepaper was under the direction of and for the benefit of the parent companies.
- Regarding the Website representations, the Court found that the appellants failed to discharge their burden of proof that the first respondent was the maker of the representations or had adopted their contents as its own.
Additionally, the Court was of the view that the pleaded representations were either not proven to have been made or did not amount to actionable representations of past or present fact.
- The Court rejected the meanings of the two of the Whitepaper representations pleaded by the appellant as they did not cohere with the full context of the Whitepaper.
- The remaining Whitepaper representations were not representations of fact but of the future state of affairs reflecting the vision of the prospective operation of the blockchain project.
- As for the Website representation, the Court found that the appellants had failed to discharge their burden of proof as to their reasonable meaning, and in any event, none of them could be read as representations of past or present fact, but representations as to the future which were not actionable.
The Court of Appeal’s decision presents a cautionary note for the crypto-industry. Token issuers and intermediaries involved in the issuance and marketing of digital tokens need to be mindful of what they say regarding the tokens, and how they say it, bearing in mind that the favoured mediums for crypto-marketing – be it through X, Reddit or Telegram community channels – record such representations with greater permanence and carry these representations through the borderless web to an indeterminate number of recipients. Token buyers, on the other hand, need to consider marketing materials closely and recognise that representations regarding digital tokens are typically aspirational and plans for the tokens may change for a variety of reasons that are frequently beyond the token buyers’ control.
The first respondent was successfully represented by Vikram Nair and Foo Xian Fong from the Corporate & Commercial Disputes Practice.
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