Many reasons that a company of crypto-currencies is required to declare bankruptcy. And whatever the reasons, the observers are concentrated in the knowledge of the course of proceedings in bankruptcy. A new report has just been published to explain the topic.
Contents
The repayment of the investment
The report was prepared by the faculty of law of the University of Oxford. The lines highlight the legal risks associated with depositing money with a crypto-company, as well as the possible case in a possible bankruptcy of the latter.
Based on the analysis of researchers, the promise according to which investors have free access to their crypto-assets delivered in the depositories of the assets is a red herring. In fact, the majority of the funds in digital form are managed in particular by the company, so there is no guarantee that it can always be solvent in the event of a serious problem.
And for proof, the exchange platforms, having deposited the key under the door, and are struggling to repay on time with its investors, which could take many years after the closure.
A common problem in the sector
Note that in almost 10 years of existence, the crypto-sphere was recorded a long list in regard to cases of bankruptcy.
The most memorable of all was the case of Mt. Gox, a site of crypto-exchange, large-scale, who had been a victim of piracy without precedent in 2014, leading to the bankruptcy of the company. Although investors continue to demand what they were entitled to Mark Karpeles, the former CEO of the company, the process is still in public hearing and in the course of treatment.
The case QuadrigaCX had also the misfortune of the investors. This crypto-canadian company had been exposed to similar problems when Gerald Cotten, the director general of the company, died, in 2018, when he was the only person who has access to the keys of the cold storage of the company’s portfolio.
Even if the company crypto had wanted to straighten up, now her work, she had to finally declare bankruptcy. As for clients, they will have a long wait before you can get their money back.
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