When a crypto lending platform files for bankruptcy, depositors typically discover they are not protected account holders. They are unsecured creditors in a Chapter 11 proceeding, ranked alongside other claimants competing for whatever assets remain. The 2022 wave of crypto lender collapses turned this legal reality into a lived experience for millions of users. Celsius froze withdrawals in June 2022 and admitted to a $1.2 billion balance sheet hole. BlockFi suspended access in November 2022 after FTX’s collapse exposed $680 million in loan exposure. This article explains the bankruptcy process, examines actual ... (full story)