On Oct. 18, the U.S. Bankruptcy Court for the Eastern District of Virginia approved the professional fee applications in the Nordic Aviation Capital bankruptcy cases, including the rates of each of the professionals as appropriate market rates.
On November 11, 2022, FTX, the world’s third-largest cryptocurrency exchange, filed for Chapter 11 bankruptcy protection in the United States. Reports suggest that the exchange might have a shortfall of as much as US$8 billion. The collapse has sent shockwaves through the cryptocurrency market, undermined investor confidence and led to renewed calls for authorities to accelerate the implementation of fit-for-purpose regulations.
Chapter 11 Bankruptcy
Poor Chicago.
Unlike the result for Chicago’s traffic ticket income in Fulton v. Chicago, the U.S. Supreme Court refuses to rescue Chicago in City of Chicago v. Mance (Case No. 22-268; Cert. denied, 11/21/2022).[Fn. 1]
On November 29, U.S. Senator Ron Wyden (D-OR), Chairman of the Senate Finance Committee, sent requests for information to the CEOs of six of the largest crypto exchanges. The requests seek information about the safeguards each exchange has put in place to protect customers’ assets in the event they file for bankruptcy or otherwise experience financial distress.
Summary of Key Uniform Commercial Code (UCC) Amendments
One of the world’s largest cryptocurrency exchanges—FTX Trading Ltd.—and many of its affiliates filed for bankruptcy earlier this month.1 While the full impact of the FTX bankruptcy is not yet clear, various responses from the executive branch and federal and state regulators indicate that, in the short term, agencies will continue to use their existing authorities to seek information about the practices of crypto market participants and to enforce existing rules to protect customers and avoid further market contagion.2 The following statements may indicate what market
We are heading into the holiday season. It’s a Wonderful Life will be on television. And cryptocurrency bankruptcies will be in the news. Yesterday, BlockFi filed for bankruptcy. What does a seventy year old Frank Capra movie – about a bank run in a small town during the Great Depression – tell us about the latest crypto platform’s liquidity crisis? Will depositors get their money back? Is there any insurance for the creditors?
BlockFi Inc. and eight of its affiliates followed the paths of crypto platforms Voyager, Celsius and FTX by filing for bankruptcy protection. The case, commenced in the District of New Jersey, on November 28, 2022, is off to a fast start. BlockFi filed a plan of reorganization on the first day of its case. The plan proposes a standalone restructuring but allows the company to toggle to a sale of all or substantially all of the company’s assets. The company had its first day hearing in New Jersey on November 29th and expressed an interest in exiting bankruptcy expeditiously.
Part 1 – Celsius Bankruptcy
Online claims-trading platform Xclaim Inc. came under scrutiny this past summer in the Madison Square Boys & Girls Club Inc. bankruptcy case pending in the United States Bankruptcy Court for the Southern District of New York. Since at least 2019, Xclaim has executed agreements with at least five notice and claims agent firms to synchronize their proofs of claim registers with Xclaim’s website where such claims are posted for sale.