Shrem's Lawyer Responds to Allegations, Claims Client Didn't Steal 5,000 BTC

Charlie Shrem’s lawyer has responded to the Winklevoss allegations that he stole 5,000 BTC from the pair in 2012.

The early Bitcoin adopter refutes the claims saying he cannot have taken the Bitcoin because it never belonged to the Gemini exchange founders to begin with.

Shrem’s Lawyer: Charlie “Has Never Owned 5,000 Bitcoins”

In a lengthy court document published today, early Bitcoin investor Shrem has denied using stolen money from the Winklevoss Capital Fund (WCF) to buy 5,000 BTC for the pair in December 2012.

The twins had filed the original complaint on September 11, 2018 saying that Shrem had spent $61,000 of their money to buy Bitcoin and was now living lavishly off the gains made largely thanks to last year’s bull market. However, Shrem was only made aware of the allegations on October 26, hence the delayed response from his legal team.

Shrem’s lawyer, Brian E. Klein, has responded to the allegations by stating that the 5,000 BTC mentioned in the Winklevoss’s original complaint never belonged to the twins. It instead was that of an anonymous contact of Shrem who, for confidentiality’s sake, is referred to as “Mr X” and a “prominent Bitcoin industry member” in the court document.

Klein claims that Mr X had sent an email out to various people in the Bitcoin community in December 2012 asking for help putting a large amount of Bitcoin into cold storage. Shrem agreed and responded that day saying so. He included one of the addresses referenced in the Winklevoss complaint — “1Shremdh9tVop1gxMzJ7baHxp6XX2WWRW ” — for Mr X to sent the 5,000 BTC to.

Mr X obliged and transferred the Bitcoin to Shrem’s wallet on December 31 after agreeing to meet to setup the cold storage. Klein claims that the pair made the final transfer of funds to Mr X’s wallet from Shrem’s office at a later date.

The receiving wallet, “1MQ3K9aPcEDCekpFBGyDAgtD1uPss8E7rY”, is also referenced in the original Winklevoss complaint. However, Klein asserts that his client never had control of the private key to Mr X’s wallet and since he has “never owned 5,000 all at one time” has no idea where the Winklevoss allegations stem from.

During the document, there is little mention of the whereabouts of the $61,000 that Shrem supposedly owes to the twins. Instead, it focuses on explaining the origins of the 5,000 BTC mentioned in the Gemini exchange founders’ original complaint.

Presumably Klein’s client would much prefer to be ordered to pay back just $61,000 instead of the more than $32.5 million in Bitcoin that Tyler and Cameron claim is rightfully theirs should their allegations carry any truth whatsoever.

Shrem’s lawyer is demanding the New York District Court award legal fees to his client and stated:

“Shrem engaged in no wrongdoing. Period… The Court should also exercise its supervisory powers and dismiss the entire case at this time in light of its false premise and the unfair, significant disruption it has caused to Shrem’s life.”