In the past few years, the world has witnessed an unprecedented explosion in the popularity and adoption of cryptocurrencies. These digital assets have captivated global attention and transformed the financial landscape, revolutionizing how we perceive and transact with money. However, several cryptocurrency companies filed for bankruptcy in 2022, causing the crypto market to decline by more than $2 trillion. The string of bankruptcies has prompted investors to file cryptocurrency bankruptcy lawsuits.
If you have been barred from withdrawing funds from a crypto exchange, The Lake Law Firm can help you. A cryptocurrency bankruptcy lawyer from our firm can help you get your money back. Call (888) 525-3529 or fill out the free case evaluation form on this page today to speak with one of our team members.
In a swift ascent to fame, cryptocurrency rapidly gained popularity, becoming a favored investment option for individuals worldwide. Decentralized technology, the potential for high returns, and a growing skepticism towards traditional financial systems led to a surge in interest in cryptocurrency. In 2021, cryptocurrency peaked, with one of the biggest names in crypto, Bitcoin, valued at $68,000. Many flocked to crypto exchanges, enabling customers to buy, sell, and exchange digital assets. However, this all came crashing down in 2022.
Following the downfall of TerraUSD and LUNA, the first half of 2022 witnessed a decline in the prices of all significant cryptocurrencies. The collapse of TerraUSD and Luna resulted in investors losing over $40 billion and set off the demise of other prominent crypto exchanges. Also, by November 2022, FTX, FTX.US, and BlockFi had filed for Chapter 11 bankruptcy. The cryptocurrency market experienced a drastic 70% fall from an evaluation of $2.7 trillion to only $830 billion.
The collapse of various crypto companies, starting with TerraUSD and LUNA in May 2022, led to a loss of trust in the crypto market. This triggered a series of bankruptcies, including those of Celsius Network, Voyager Digital, FTX, and others, causing significant investor losses. These bankruptcies had a ripple effect since many crypto companies are connected through loans and investments.
These crypto companies borrowed money to make investments that did not work out, leaving them unable to repay the initial loan. Before filing for bankruptcy, many crypto exchanges froze investor assets, leaving them unable to withdraw funds. Investors have lost billions of dollars, prompting them to seek cryptocurrency bankruptcy lawsuits.
The fall of the first crypto exchange sent shockwaves throughout the community, generating a ripple effect that tore down many others. Individuals are filing cryptocurrency bankruptcy lawsuits against several insolvent crypto exchanges and crypto lenders, including:
If you have been denied access to funds by one of these companies or another crypto exchange or lender, a cryptocurrency bankruptcy lawsuit can help you. Celsius customers alone lost roughly $5 billion, while more than a million depositors lost their money after FTX’s collapse. The Lake Law Firm is determined to assist individuals in retrieving their losses and holding fraudulent companies accountable.
Lawsuits allege that crypto exchanges and lenders engaged in fraudulent practices, stealing billions of dollars from investors. The resulting bankruptcies have allegedly cost innocent people their investments, savings, and retirement funds.
Plaintiffs accuse companies of making misrepresentations about the safety of cryptocurrency to coerce them into using their exchange. Cryptocurrency is in a “Wild West” stage, characterized by a lack of comprehensive government regulation. Without established frameworks and oversight, the crypto market operates with limited accountability, posing risks for customer assets. Additionally, investors claim companies fraudulently used their funds to make risky investments, resulting in their swift collapse and the freezing of investor money.
Lawyers are partnering with wrongfully harmed crypto investors to reclaim their money. Individuals are stuck in limbo due to the bankruptcy proceedings, while some are left in financial ruin.
In May 2023, the Judicial Panel on Multidistrict Litigation launched a multidistrict litigation (MDL) to handle cryptocurrency bankruptcy lawsuits against FTX. Multidistrict litigation is when similar lawsuits from multiple courts are consolidated and transferred to a single court for more efficient handling. Therefore, it’s a positive development for plaintiffs because it allows them to join forces, pool resources, and present a stronger case against a common defendant.
These lawsuits address FTX’s alleged fraudulent conduct, specifically the actions of founder and CEO Sam Bankman-Fried. Following the formation of the MDL, fourteen cases were pending under the MDL as of June 2023.
Unable to get your money out of bankrupt crypto exchanges? You may be eligible for a cryptocurrency bankruptcy lawsuit. The Lake Law Firm works diligently to hold these companies accountable for the frivolous nature with which some have handled the livelihoods of individuals. Lawsuits allege the irresponsible conduct of crypto exchanges has jeopardized the financial security of millions of people. Furthermore, by pursuing legal action, we seek to recover funds and obtain appropriate compensation for clients to help them rebuild their lives.
The Lake Law Firm was founded by Edward J. Lake, Esq., a personal injury lawyer for over 25 years. Our dedicated team of attorneys is committed to seeking justice on behalf of those who have suffered injury or death due to the negligence of others. Our experienced attorneys handle many different types of pharmaceutical drugs, medical devices, and other defective products. The lawyers in our firm have helped collect millions of dollars for their clients. A cryptocurrency bankruptcy lawyer will advocate for you and your rights. Please contact us for a free confidential case evaluation at (888) 525-3529 or submit an inquiry on this page.
The Lake Law Firm
N/a
