Bankruptcy Evolution and Ecosystems

This chapter explores the transformation of the U.S. bankruptcy system since the late 1970s, focusing on the implementation of Chapter 11 and its structured approach to helping distressed companies. It uses a Serengeti metaphor to describe the roles of different creditors during bankruptcy, from secured creditors to opportunistic investors. Highlighting the FTX bankruptcy case, the chapter examines the dynamics of distressed investing and the evolving prospects for recovery in chaotic financial environments.