The recent bankruptcy filings by several major crypto platforms have given rise to unexpected realities for customers and investors. The sudden change in rights, legal exposure in bankruptcy litigation and varying outcomes in the several different proceedings can be reminiscent of a Hollywood multiverse where infinite realities are possible.
Perhaps the area in which an alternate reality is most accessible is the valuation of digital assets. The Bankruptcy Code does not specifically address how, and as of what date, digital assets are to be valued, and although certain bankruptcy courts have provided guidance, the outcomes appear highly dependent on context.