The Bitcoin sub-fund was incorporated as a Bermuda exempted company and is registered as a segregated account company receiving funds at Citibank London.

FORBES: First Bitcoin Hedge Fund Launches From Malta

Although, the Court acknowledged that he did a good job using Quickbooks to track his expenses, he did not have an account that segregated his horse business.

FORBES: Written Business Plan Is Crucial In Horse Tax Court Case

In a bankruptcy filing in the U.S. (think Refco), segregated futures accounts have seniority over other creditors and equity holders, so futures account holders get paid first.

FORBES: Offshore Forex Trading Is Heading Back To U.S. Shores