Debevoise Discusses Key Questions Recent Crypto Bankruptcy Filings May Answer

One of the key unresolved questions surrounding crypto-custodian bankruptcy proceedings under the U.S. Bankruptcy Code is whether or not digital assets that are held by a crypto exchange on behalf of platform users could be viewed as the exchange’s corporate assets in the proceeding, which in turn could be used to satisfy debts of other creditors.[1]  As we explained in a recent article, such determinations are fact specific and turn on various factors such as: 1) the intent of the parties, as reflected in, for example, the terms of any custodial or other agreements that exist between the … Read more