Bitmain vs. Exawatt Crypto Dispute Sparks Debate Over Future Legal Precedents
A dispute between Chinese crypto mining manufacturer Bitmain and European company Exawatt is unfolding in Hong Kong, and it’s not just about contracts.
Parallel criminal proceedings launched in Lithuania have turned this commercial dispute into a complex test of international law, raising new questions about how cross-border crypto conflicts will be resolved in an increasingly globalized industry.
The Arbitration Dispute
The dispute centers on allegations that Lithuanian company Exawatt breached contract terms related to cryptocurrency mining operations in Lithuania.
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Bitmain, a leading crypto mining hardware manufacturer, filed a claim in August 2024 with the Hong Kong International Arbitration Centre (HKIAC), seeking damages. Exawatt responded in April 2025 with a counterclaim accusing Bitmain of failing to meet its own contractual obligations.
Due to the confidentiality of arbitration proceedings, neither party can publicly discuss the precise contractual issues at the heart of the dispute.
Arbitration is often the preferred method for resolving commercial disputes, offering confidential and faster decisions that are typically final.
But here’s what makes this story unusual: Bitmain and Exawatt are engaged in parallel legal proceedings amid a broader controversy in Lithuania.
Parallel Litigation in Lithuania
Bitmain has initiated arbitration proceedings in Hong Kong while also filing a criminal complaint in Lithuania related to the same underlying issues, according to Exawatt’s legal counsel, Dr. Karolis Gudas.
The dispute intersects with a public scandal involving businessman Vilhelm German, who is connected to Exawatt. Lithuanian authorities launched an investigation in October 2024 into potential financial crimes of over €17 million, linked to Foxpay, a financial firm also associated with German.
The case sparked a wave of political and media attention in Lithuania. In mid-October, Vilhelm German was taken into custody, and investigators seized his electronic devices as part of an ongoing criminal probe.
Dr. Gudas suspects the Chinese company may have taken advantage of the public reputational scandal involving the Vilhelm German and deliberately initiated two parallel proceedings.
“In our opinion, Bitmain deliberately exploited the publicly escalated reputational scandal involving Foxpay and Vilhelm German,” a law expert says.
According to him, heightened media attention and public comments by high-ranking officials may have directly influenced the actions of law enforcement authorities, which have limited Exawatt’s ability to participate in the arbitration fully.
A Question of Procedural Fairness
The use of parallel legal proceedings in complex, cross-border crypto cases is drawing concern from legal experts, who warn that the practice could blur the lines between civil arbitration and criminal enforcement.
Dr. Karolis Gudas, legal counsel for Exawatt, stated that this type of dual legal action is unusual but demonstrates the increasing complexity of crypto disputes. He explains that international disputes involving cryptocurrency are on the rise, often involving commercial claims, regulatory rules, and, in some instances, criminal law.
While current legal structures permit multi-jurisdictional proceedings, Gudas noted that simultaneous actions, particularly when initiated over the same core facts, may be perceived as attempts to exert procedural leverage.
“Such actions can be used as a strategic pressure tactic,” said Dr. Gudas. He warns that intense media scrutiny and public commentary from officials may influence law enforcement decisions and spill over into civil proceedings.
Gudas argued that while parties are entitled to report suspected criminal conduct, business disputes are best addressed through commercial and contractual mechanisms. Initiating both arbitration and criminal proceedings simultaneously, he argued, undermines the fairness of the legal process.
Parallel litigation is increasingly being viewed as a strategic tool in cross-border disputes, according to Sharmilla Bhima, a member of the International Council for Commercial Arbitration and an arbitrator at the Mauritius International Arbitration Centre (MIAC).
She notes that such tactics can result in duplication of resources, a higher risk of contradictory judgments, and even potential harassment of parties involved.
Crypto Dispute Could Set Legal Precedent
The Bitmain vs. Exawatt case is becoming a key example of just how complex legal disputes in the crypto world can get when they span multiple countries and legal systems.
Although still uncommon, the crypto industry has seen companies involved in both arbitration and national court cases over the same issues, underscoring the sector’s expanding legal challenges that span borders.
Back in 2022, UK trader Dmitry Chechetkin sued Kraken’s parent company, Payward Ltd., in both a San Francisco arbitration and an English civil court.
Chechetkin accused the company of violating UK financial laws and sought compensation for his losses. The arbitration case was dismissed, but the English court case continued.
Karolis Gudas states that the Bitmain-Exawatt dispute extends even further, involving not only arbitration and civil litigation but also criminal investigations.
This overlap raises tough questions: How should these systems coordinate? What if one finds guilt while another does not? And how can international arbitration maintain credibility if conflicting decisions emerge?
These concerns are echoed by the international legal community, which warns that parallel proceedings increase the risk of contradictory decisions, potentially undermining the legitimacy of arbitration.
There are no clear answers yet, but with commercial and criminal cases unfolding simultaneously, the international arbitration system faces a significant test.
Why This Matters
The Bitmain vs. Exawatt dispute could set a legal precedent for how cross-border crypto cases are handled. If parallel civil and criminal proceedings become a common tactic, it may erode trust in international arbitration, create conflicting rulings, and chill participation in global crypto ventures.
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People Also Ask:
Arbitration in crypto disputes is a private, legally binding method of resolving conflicts between parties involved. Instead of going through national courts, parties agree to let a neutral third party (an arbitrator or tribunal) decide the outcome.
Parallel litigation refers to multiple legal proceedings, such as arbitration and criminal investigations, occurring at the same time over similar issues.
Crypto companies often use arbitration for confidentiality and speed, especially in disputes involving contracts and cross-border agreements.
They may lead to conflicting rulings, procedural unfairness, resource duplication, and potential pressure tactics in cross-border disputes.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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