Legal responsibilities in the context of investment assistance with cryptocurrencies: Analysis of a recent case before the Higher Regional Court (OLG) Frankfurt am Main
In its judgment of May 11, 2023 (Ref. 13 U 82/22), the Higher Regional Court (OLG) Frankfurt am Main addressed key questions regarding liability in so-called courtesy relationships in the context of investments in cryptocurrencies. The focus was particularly on the legal classification of the relationship between an investing individual and a third party who provides assistance with investments. The judgment provides valuable guidance, especially for private individuals and investors who make investment decisions in dynamic markets such as cryptocurrencies through informal assistance.
Background to the proceedings
In this specific case, the plaintiff asked an acquaintance for assistance with investments in various cryptocurrencies. The acquaintance provided his own IT expertise and experience in the field of digital assets, but did not conduct any professional investment advice. After suffering losses due to market volatility, the plaintiff sought damages, alleging breaches of duty on the part of her acquaintance.
Legal classification of the courtesy relationship
Distinction from quasi-contractual obligations
The OLG Frankfurt made it clear that not every form of assistance with investments automatically leads to binding contractual obligations. It was decisive that, in the matter in dispute, there was a courtesy relationship which as a rule does not establish legally binding obligations to perform. There was a lack of any express or implied declaration of intent to establish a quasi-contractual obligation.
Expectations and need for protection of the parties involved
In the present case, the investment assistance was provided in a private, friendly context. The court carefully weighed the expectations of the parties and differentiated between a mere act of assistance and a legal commitment. What is decisive is whether objectively legally relevant declarations were made and whether there was a justifiable expectation of obligations to perform. The OLG ultimately denied the existence of such a constellation.
Duties of care and standards of liability for investments in cryptocurrencies
Duties in informal assistance
Even when third parties provide assistance in the context of crypto investments, duties of care may arise if specific instructions are followed or specific promises are made with regard to increasing or preserving the invested amount. In the case at hand, however, the court found no indication of a consciously assumed stewardship extending beyond the general courtesy relationship.
Risk allocation and market peculiarities
The court also pointed out that the high risk of investing in cryptocurrencies is generally known and recognizable to informed investors. Those who voluntarily and merely on an informal basis rely on the help of third parties generally bear the risks themselves—unless the supporter expressly assumes a guarantee or security arrangement. The particularities of the crypto market, with its considerable price volatility, also do not justify lowering the threshold for establishing a legal commitment.
Implications and significance for practice
Requirements for establishing legal obligations
The judgment underscores the need for clear agreements and, if necessary, written contracts, when parties wish to establish binding obligations in connection with digital capital investments. In light of the case law, liability can generally only be assumed if the parties have expressly or implicitly agreed on a specific obligation.
Limits of private assistance
Especially in the area of digital assets, such as Bitcoin, Ethereum and other crypto-assets, investors should be aware that non-binding recommendations or acts of support by friends, acquaintances, or third parties are generally not grounds for liability. Requirements regarding the quality, depth of advice, or assumption of liability cannot be derived from general acts of support.
Conclusion and source reference
The judgment of the OLG Frankfurt am Main underscores the legal limits of private support in investment decisions regarding cryptocurrencies and thus provides clarity for all parties involved. Investors and supporters should be aware of the scope of their agreements and the legal classification of their respective relationships. Comparable cases remain conceivable. In the absence of a supreme court decision, the legal situation remains open in detail (Sources: OLG Frankfurt am Main, Judgment of 11.05.2023, Ref. 13 U 82/22; https://urteile.news/OLG-Frankfurt-am-Main13-U-8222OLG-zur-Haftung-im-Gefaelligkeitsverhaeltnis-bei-Investitionen-in-Krypto-Waehrungen~N32877).
If you have any uncertainties regarding the aspects presented or related legal questions in the context of digital assets, the lawyers at MTR Legal are happy to provide further legal guidance.
