It is hard to ignore the media attention surrounding Bitcoin these days. Within the last few months, the virtual currency has surged to new highs, was the focus of a Congressional hearing, and was the subject of comments by former Federal Reserve Chairman Ben Bernanke, who stated that it and other such currencies "may hold long-term promise." As Bitcoin gains legitimacy, companies offering Bitcoin-related services have sprouted. As with any new industry, however, although there may be spectacular successes, there also will be many failures. A reminder of this is that amid the frenzy, a company named Alydian recently filed the first Bitcoin-related bankruptcy. Accordingly, Bitcoin users and investors in Bitcoin companies should be aware that the qualities of Bitcoin that make it attractive outside of bankruptcy, could present major difficulties in a bankruptcy proceeding. For more, please click here to read the full article published in the February/March 2014 Pratt's Journal of Bankruptcy Law.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.