This story involves a knotty area of US bankruptcy law, so bear with me…
First: Secured vs unsecured creditors. Unsecured creditors are lending without requiring the borrower to put up any assets as collateral or security. Secured creditors do require collateral/security.
— kadhim (＾ｰ^)ノ (@kadhim) July 26, 2022
There are well understood rules, processes and case law for “perfecting” security over all sorts of assets, but not for crypto because crypto is new
You may think that your lending is protected by crypto the borrower has pledged as security, but the courts might rule otherwise
— kadhim (＾ｰ^)ノ (@kadhim) July 26, 2022