The US Department of Justice is reconsidering how victims in digital asset bankruptcies and enforcement cases are compensated.

In an April 7 memo, the DOJ said it may recommend new rules or legislative fixes after creditors in cases like FTX and Celsius lost out on billions in asset appreciation.

It cited several other bankruptcies and incidents where investors lost access to crypto holdings that later surged in value, including Voyager, Genesis, BlockFi, and Gemini.

Bitcoin, for example, traded below $18,000 when FTX collapsed in November 2022 but is now trading above $85,000.

Under current rules, creditors receive fiat compensation based on those old prices.

FTX began repaying customers in February and will ramp up distributions totaling $11.4 billion later this year, offering full cash recoveries plus 9% annual interest for claims under $50,000.

Nearly 400,000 claims worth up to $2.5 billion have already been disqualified due to know-your-customer noncompliance. Many creditors say they were never properly informed.

Celsius, which exited bankruptcy in January 2024, has since distributed nearly 98% of eligible crypto assets, according to a court filing last month.

To date, the company claims to have disbursed over $2.8 billion to creditors.

However, legal experts say revising the rules won’t be easy.

Pegging repayments to current market prices could introduce timing disputes, unfair outcomes, and added risk if volatile assets plunge again.

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.