How do we handle this new class of asset?
Encrypted digital currencies, known as cryptocurrencies, provide
bankruptcy trustees with multiple challenges. These include
identifying the asset, getting control of the asset, and most
importantly, selling the asset for the benefit of creditors. In a
word, it's complex.
Does a bankrupt have to disclose crypto assets?
Yes. Crypto assets vest in the bankruptcy trustee upon
bankruptcy and must be disclosed in the Statement of Affairs (SOA),
which is a sworn declaration about the examinable affairs of a
bankrupt. The SOA does not include any specific questions relating
to crypto assets, however two areas titled "Investments"
and "Other Items of Value" (questions 30 and 37
respectively) would be appropriate places to disclose crypto
assets.
