Cryptocurrencies, Cybersecurity and Bankruptcy Law: How Global Issues Are Globalizing National Remedies

Abstract

The market for cryptocurrencies is interspersed with cases of loss, theft and fraud and a new transnational practice in bankruptcy law is emerging whereby cryptocurrency exchanges compensate the injured users on a collective basis. This paper will argue: first, that this trend has transplanted into Asia and Europe the US idea according to which bankruptcy law can be employed to avoid mass litigation; secondly, that this trend has transcended the debate about the characterization of digital assets, including the concerns of those scholars who maintain that digital coins cannot be objects of property; and thirdly that – since this practice follows the pattern of so-called restorative justice and since cryptocurrencies are highly volatile – injured users, as creditors of the exchanges, ought to be satisfied in kind, i.e. in cryptocurrencies themselves.