Pryor Cashman Partner Seth Lieberman, Chair of the Bankruptcy, Reorganization + Creditors' Rights Group and Co-Chair of the Corporate Trust Practice, was quoted in a 9fin article examining the complex legal, financial and logistical issues that arise in cryptocurrency bankruptcies.

In the article, “Smells Like Mean Spirit: Inside the Murky World of Crypto Bankruptcies,” Seth discussed how cryptocurrency volatility can complicate creditor recoveries and create competing interests among similarly situated creditors:

“Crypto is volatile. When recovery is linked to the value of crypto, then uncertainty is obviously abound.”

The feature also explored how the large number of often pseudonymous retail creditors in crypto cases can make identification, notice and consensus-building unusually difficult. Seth connected these challenges to the industry’s origins:

“Crypto was built on what I would say is an ideological distrust of government-issued currency and traditional banking. Unsurprisingly, those that flock to crypto don't trust traditional finance. They question the system, they question the way things have been done.”

Seth further addressed the disorder that can follow alleged prepetition misconduct and unreliable recordkeeping in crypto cases, noting parallels with other complex corporate failures:

“There are real issues surrounding what is often the case pre-petition malfeasance, fraudulent activity and nothing short of an outright disarray of resulting books and records. There are more correlations between a First Brands situation and a crypto situation.”

The article examines how valuation disputes, creditor anonymity, ownership questions, cross-border operations, fraud, and scams continue to shape crypto restructurings, while courts and bankruptcy professionals develop greater familiarity with digital assets.