What Happens to My Bitcoin in Chapter 7 Bankruptcy?

TL;DR

Bitcoin is not protected in bankruptcy, and if you have it, you will likely lose it as it is not exempt under regular bankruptcy laws.

Transcript

• Hey everybody, John Skiba here. And in this video, we're going to talk about what happens to your Bitcoin, if you have to file for bankruptcy. We're also going to talk about some other unusual assets, and what you can expect to happen if you find yourself needing to go through the bankruptcy process. But if this is your first time here to my YouT... Read More

Key Insights

• 📼 All assets, including Bitcoin, must be disclosed in a bankruptcy filing.
• 📼 Hiding assets during bankruptcy is a felony and can result in criminal prosecution.
• 🌂 In Arizona, Bitcoin is not exempt under bankruptcy laws, and you will likely lose it if you file for bankruptcy.
• 📼 Other states may have wildcard exemptions that can protect assets like Bitcoin.
• 👋 It is important to consult a bankruptcy attorney to understand your options and determine the best course of action for your financial situation.
• 👋 Bankruptcy may not always be the best option, depending on your equity in assets and other factors.
• 💁 Filling out bankruptcy forms accurately and completely is crucial for the court and trustee to evaluate your case.

Questions & Answers

Q: If I have Bitcoin and file for bankruptcy, will I lose it?

Yes, in most cases, if you have Bitcoin and file for bankruptcy, it will be taken by the bankruptcy trustee to pay your creditors.

Q: Can I hide my Bitcoin during bankruptcy?

No, hiding assets during bankruptcy is a crime and can result in prosecution. You must disclose all your assets, including Bitcoin.

Q: Are there any exemptions for Bitcoin in bankruptcy?

In Arizona, where the speaker practices law, there is no exemption for Bitcoin. However, other states may have wildcard exemptions that can be applied to assets like Bitcoin.

Q: Should I consult a bankruptcy attorney if I have Bitcoin and need to file for bankruptcy?

Yes, it is recommended to consult a bankruptcy attorney who can guide you through the process and advise you on the best course of action for your specific situation.

Summary & Key Takeaways

• If you file for bankruptcy, you must disclose all your assets, including Bitcoin, as hiding assets is a felony.

• In Arizona, where the speaker practices law, Bitcoin is not exempt and will be taken by the bankruptcy trustee to pay your creditors.

• Other states may have wildcard exemptions that can be applied to assets like Bitcoin, but Arizona does not.