The major downside to cryptocurrency is the risk of loss, which is even more difficult to manage when a crypto exchange is holding your keys. In July 2022, two major crypto trading platforms, Voyager and Celsius, declared bankruptcy. In November 2022, crypto exchange FTX suffered a major liquidity crisis and filed for Chapter 11.
FTX created a wave of bankruptcies throughout the industry. In 2023, BlockFi, Genesis, and 3AC (a hedge fund), all of whom had money in or loaned to FTX, failed.
But what does all this failure mean for investors wishing to get their money back after their trusted crypto exchanges fail? In a nutshell, be careful where you place your money and be familiar with the bankruptcy process.
Key Takeaways
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