Digital Financial Assets and Currency in Insolvency (Bankruptcy) Cases

Abstract

Transformation of the economy sector is associated, in particular, with the active development of the digital financial assets market, the high growth rate of the crypto-assets market. The above circumstances give rise to the need to create a legal framework to legalize or, on the contrary, to give criminal status to relatively new negative phenomena in public life. Therefore, digital financial assets serve not only as an innovative phenomenon in the economy of the XXI century, but also as an element of discussion in the legal field, in particular in bankruptcy proceedings.

In this aspect, we should note the relevance of the problem of recognizing digital financial assets as property to be included in the bankruptcy estate in insolvency (bankruptcy) cases for the purposes of satisfying the claims of bankruptcy creditors. In addition, there are cases when a debtor deliberately transfers capital to the digital space with the intention to hide it and prevent its transfer to the bankruptcy estate, taking advantage of gaps in legal regulation.

In connection with the mentioned problem, the process and mechanisms of detection and recovery of digital financial assets and digital currency in order to fulfill obligations to creditors in insolvency proceedings are of particular importance. In addition, an important issue is the subsequent sale of such property, complicated by the anonymity of the existence of cryptocurrency and the lack of identification of users of cryptocurrency wallets.