Digital Money Is An Asset That Must Be Disclosed In Bankruptcy

I’ll have to update my bankruptcy workbook.

Property of the bankruptcy estate includes “all legal or equitable interests of the debtor in property as of the commencement of the case.”

As the author notes, digital currency is indeed a form of property that must be disclosed in bankruptcy; furthermore, it is fast becoming a form of property on the Bankruptcy Trustee’s radar.

Resnick Law Offices

By Kelly M. Resnick, Resnick Law Offices, Bay Area (Oakland and Newark/Fremont office locations)

According to Fox News, AB 129 was just signed into law by Governor Brown. This law now legalizes so-called ‘Digital’ currencies as a medium of exchange in California.  Originally introduced by Assemblyman Roger Dickinson (D-Sacramento), the new law recognizes the changing landscape of consumer transactions.  Bit Coins, Amazon Coins, Starbucks Stars and other ‘crypto-currencies’ are now legal units of tender for certain debts within the state borders.  According to the Bitcoin Price Index, the price of a Bitcoin shot up from $591 on Friday, June 27 to $615 on Monday, June 30.

In response to this news, Bankruptcy Trustee’s are now directly asking the Debtor if he or she owns any of these currencies when the case was filed.  We can still use any remaining portion of the “wildcard” exemption (i.e. how your property is protected…

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