In the following testimony, Patrick Strateman confirms that he has held 10s of millions of dollars worth of user bitcoin and since 2014 has only paid back about a dozen people.
1 Q. Thank you, Mr. Strateman.
2 As of today, are there still Intersango
3 users who still have Bitcoin with Intersango?
4 A. Yes.
5 Q. How many users today still exist who
6 have Bitcoin with Intersango approximately?
7 A. I'm really not sure.
8 Q. Do you know if it's in the low
9 thousands -- 5,000?
10 A. Well, there are some people who have
11 very tiny amounts of Bitcoin on Intersango because
12 we recorded how much they had down to, like, 8 and
13 12 decimal places. So when you asked how many
14 users there are in Intersango that still owed
15 Bitcoin.
16 Effectively every user is owed a
17 ridiculously tiny amount. So, when you ask that
18 you have to ask, like, what amount from what time
19 period.
20 Q. I'm just asking if you know today how
21 many users still have some Bitcoin with
22 Intersango.
23 A. There were thousands of users. So
24 people owed something more than literally zero,
25 probably all of them, but the number that are owed
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1 more than a dollar worth. I don't know.
2 Q. So -- but, do you know today how many
3 users there are who still have some Bitcoin with
4 Intersango?
5 A. I think I just answered your question.
6 Q. Well, do you know if it's approximately
7 2,000 or 5,000, do you have approximation of any
8 sort?
9 A. No.
10 MR. YEH: Your Honor, I would like to
11 admit into evidence Plaintiff's Exhibit 45. This
12 is Defendant Patrick Strateman Amended Response to
13 Plaintiff Donald Norman Special Interrogatories,
14 Set 4. This is dated April 18, 2019.
15 MS. HEATON: No objection, Your Honor.
16 THE COURT: Plaintiff's Exhibit 45 is
17 admitted.
18 (Whereupon, Plaintiff's Exhibit 45 was
19 received into evidence.)
20 MR. YEH: May I approach, Your Honor?
21 THE COURT: Yes.
22 MR. YEH: Thank you, Mr. Strateman.
23 Mr. Strateman, you have in front of you
24 a document entitled -- basically, your amended
25 responses to Mr. Norman's Special Interrogatory,
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1 Set Four; is that correct?
2 THE WITNESS: Yes.
3 BY MR. YEH:
4 Q. Now, I'm going to turn your attention to
5 page 7 of this document. The document on the page
6 is entitled "verification." And this verification
7 appears to be signed by you. Is that your
8 signature?
9 A. Yes.
10 Q. I'm going to ask you to turn to page 4
11 of the document. You will see at lines 12 and 13
12 there is Special Interrogatory Number 22, and it
13 says "State the number of Intersango users that
14 Bitcoin is currently still being held by
15 Intersango." Do you see that?
16 A. Yes.
17 Q. Do you see at the bottom of that page,
18 "Amended Response to Special Interrogatory Number
19 22." There appear to be certain objections here,
20 and then at the very bottom it says "The defendant
21 responds as follows."
22 And we turn to page 5. And do you see it
23 says "Defendant is informed and believed there are
24 5,681 users who have an account balance greater
25 than zero Bitcoin."? Do you see that answer?
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1 A. Yes.
2 Q. So it appears that, at least, as of this
3 time in 2019, there were 5,600 users who still had
4 Bitcoin with Intersango; is that right?
5 A. Greater than zero Bitcoin, yes.
6 Q. Greater than zero, they had Bitcoin with
7 Intersango; is that right?
8 A. Yes.
9 Q. Between the time the Website shut down
10 and this time period in 2019 how many people did
11 you pay back -- how many customers of Intersango
12 did you actually pay back? Do you have any
13 recollection of that number?
14 A. Can you say the dates again?
15 Q. Sure. From between the time that the
16 Intersango Website shut down and you had to be
17 involved in the process to April 2019, do you know
18 how many people, approximately, you paid back?
19 A. Maybe a dozen.
20 Q. So -- and we said that the Website went
21 down in 2014; is that right?
22 A. Yes.
23 Q. And so from 2014 to 2019 you paid back a
24 dozen people -- 12 people; is that correct?
25 A. Approximately, yes.
the testimony continues…
1 Q. For these outstanding users, the 5,600
2 users that remain outstanding, have you contacted
3 these users about the Bitcoin?
4 A. No.
5 Q. Did you ever take time to look through
6 the Intersango database to help identify those
7 people who still had Bitcoin with Intersango?
8 A. When people would contact us -- contact
9 me.
10 Q. So the only time that you would
11 proactively -- withdrawn.
12 So your process was this: When people
13 contacted you to ask for their Bitcoin back, then
14 you would engage them, but, otherwise, you were
15 not reaching out to people who had Bitcoin with
16 Intersango; is that correct?
17 A. Yes.
18 Q. Mr. Strateman, approximately how many
19 Bitcoin does Intersango still have that are user
20 Bitcoin?
21 A. I'm not sure.
22 Q. Do you have an approximation?
23 A. No. More than a thousand and less than
24 10,000 is my best. It was -- in 2014 it was more
25 like 10,000, but it's significantly less since
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1 then.
2 Q. So, your testimony is that to the best
3 of your recollection you're holding somewhere
4 between 1,000 and 10,000 Bitcoin of user funds?
5 MS. HEATON: Objection. Argumentative.
6 THE COURT: Overruled.
7 THE WITNESS: Let's see. I'm trying to
8 narrow it down. I think it's more between 1,000
9 and like 4,000, but I'm not sure at this point.
10 BY MR. YEH:
11 Q. Mr. Strateman, when is the last time you
12 examined how many Bitcoin you were holding for
13 customers?
14 A. Probably the last time someone was paid.
15 Q. So, now, Mr. Strateman, you are in the
16 process of winding down Intersango; that's
17 correct, right?
18 A. Yes.
19 Q. And do you keep track of the price of
20 Bitcoin?
21 A. Yes.
22 Q. And so do you have an idea about how
23 much it's worth today?
24 A. Yes.
25 Q. Is it worth about roughly 20,000; is
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1 that right?
2 A. It was last week, yes. It was last
3 week. I don't know about today in particular.
4 Q. So you're holding on to many tens of
5 millions possibly of Bitcoin that belong to the
6 customers; isn't that right?
7 A. Yes. I'm keeping them safe.
8 Q. And between -- in this five-year from
9 2014 to 2019, you paid back 12 people?
10 A. I paid back people who appeared -- who
11 asked and who could verify their claim in a
12 reasonable way.
13 Q. Thank you, Mr. Strateman.
-
much later in the testimony…
15 Q. Okay. And so we can agree that the
16 original Bitcoin for the customers belonged to the
17 customers, correct?
18 A. The original customer was owed one
19 Bitcoin, yes.
20 Q. And they're still being held by
21 Intersango, correct?
22 A. Yes.
23 Q. So for all intense purposes, the
24 customer Bitcoin in the Intersango wallet, that's
25 not being held by you, that's being held by
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1 Intersango, correct?
2 A. I mean, it's in a wallet that I control
3 and have keys for.
4 Q. But, they are held by Intersango, not by
5 you, correct, I understand you have the keys. I'm
6 asking whether you or Intersango are holding these
7 Bitcoin for the customers.
8 A. Intersango owes the customers, but I
9 have control of the wallet.