Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-01125
Platform bankruptcy — exchange custody (2023)
SurvivesCase description
The US Department of Justice filed a motion in June 2023 to block Bittrex's plan to repay customers before government creditors—including OFAC (owed $24 million) and FinCEN (owed $29 million)—were paid. The DOJ argued that customer assets could be 'clawed back' if regulators were not paid in full first. A Delaware bankruptcy judge rejected the motion on 14 June, allowing customer withdrawals to resume on 15 June. The episode illustrated how government regulatory claims could compete directly with legitimate customer recovery rights.
Custody context
| Stress condition | Legal or authority constraint |
| Custody system | Exchange custody |
| Outcome | Survives |
| Documentation | Unknown |
| Year observed | 2023 |
| Country | United States |
Structural dependencies observed
Outcome interpretation
Access remained possible under the reported conditions.
Source
Publicly Reported
Evidence type
News article
Related cases involving legal or authority constraint
39 cases involve legal or authority constraint
512 cases involve exchange custody
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This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
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Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.
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