Insolvency lawyer, "Strengthening the cryptocurrency personal rehabilitation bankruptcy litigation structure... Early response is important."
As the cryptocurrency market has recently shown a sharp decline and market anxiety is growing, there are warning signs that individual investors who have jumped into cryptocurrency investment (debt investment) are putting themselves at risk. The legal community advises that individual investors who eventually face bankruptcy through so-called ‘leverage investment’, which involves borrowing money to buy cryptocurrency, can consider the personal rehabilitation system. Insolvency lawyer Shim Jae-guk (Daeryun Law Firm) said, “If an individual debtor facing bankruptcy has a certain amount of income in the future, he or she may be able to utilize the personal rehabilitation system, which allows the remaining debt to be exempted by repaying a certain amount over a set period of time.” However, there is a recent case in which the court dismissed the application, believing that it was an abuse of the personal rehabilitation process when the debt was significantly increased through cryptocurrency investment, which appeared to be a speculative activity. Regarding this, he explained, “The court ruled that speculative debt can be a ‘moral hazard’ as a result of abuse of the personal rehabilitation system, so even if it is a system with no limit on debt, if the application is not sincere, it can be dismissed.” He pointed out that cryptocurrency investment is different from gambling or speculation, and it is not difficult to find advertisements saying that rehabilitation can be applied for, so caution is needed. Attorney Shim said, "If the application for rehabilitation is not sincere, the court may not accept the application for rehabilitation. If the reason for the application for rehabilitation is excessive debt arising from a highly speculative investment, it may be helpful to first seek legal assistance through legal counseling." Jaeguk Shim, an insolvency lawyer, said, "Even if the debt is speculative, the debt situation may be different for each individual, such as the degree of debt and the circumstances of the investment. If sufficient persuasion is provided to the court, the decision to approve personal rehabilitation can be made." “There is a possibility that you can receive it,” he said. “In particular, when applying for personal rehabilitation bankruptcy with cryptocurrency or stock investment debt, the court will strictly look at the repayment plan, so you will need to prepare the application documents meticulously and thoroughly.” He also said, “If you are an individual debtor with debts of more than 10 million won, unsecured debts of 1 billion won, and secured debts of 1.5 billion won or less, and you are an income earner with a certain income, it is advantageous to apply for rehabilitation, and the total debt is 2.5 billion won. “If your income exceeds KRW or is below the minimum cost of living, it would be advantageous to file for bankruptcy,” he said. However, if an individual has excessive debt, the beneficial debt adjustment system may be different, and as the number of applicants for rehabilitation bankruptcy has increased, the court has emphasized legal assistance by judging application documents and materials strictly. Daeryun Law Firm, which provided assistance, provides legal consultation on rehabilitation bankruptcy. Currently, we have offices all over the country, including Seoul, Busan, Daegu, Incheon, Gwangju, Daejeon, Ulsan, Suwon, Changwon, Cheongju, Jeonju, Uijeongbu, Chuncheon, Jinju, and Jeju. View original article - https://n.news.naver.com/article/119/0002497878