It seems like just yesterday when Bitcoin investors were startled by the news that Mt. Gox, one of the world ’s first Bitcoin exchanges, was in serious trouble.
Five years ago, on Feb. 24, 2014, reports began circulating that the Bitcoin exchange had lost three-quarters of a million bitcoins.
One day later, the company – perhaps the closest thing to a single point of failure in the Bitcoin industry – announced that it was shutting down operations.
— Ryan Selkis (@twobitidiot) February 24, 2014
Mt. Gox initially tried to downplay its woes, but the you-know-what hit the fan when the company filed for bankruptcy protection, first in Tokyo on Feb. 28 and then in the U.S. on March 9.
At that time, Mt. Gox, the world’s largest Bitcoin exchange, was vague about how long it would not allow transactions to be completed. As late as February 2014, Mt. Gox handled more than 70% of all Bitcoin transactions worldwide.
Since those dreadful dates, Bitcoin HODLers have remained steadfast in their commitment to the industry, even throughout the multiyear downturn that followed the Gox collapse.
Many lessons were learned, though some – such as the danger of storing significant amounts of cryptocurrency on centralized exchanges – were not.
Mt. Gox CEO Might Serve Time, But Where’s All the Money?
Mt. Gox’s lifespan was relatively short, lasting just four years, though its shadow continues to loom large in the cryptocurrency industry.
Mark Karpeles, the CEO of Mt. Gox, faces up to a decade in prison on charges of embezzlement. He claims that he is innocent.
Meanwhile, Mt. Gox users have still yet to recoup the funds that they were holding on the exchange when it collapsed.
One crypto influencer hopes to change that – and soon.
Enter Brock Pierce and Gox Rising
CCN reported that Brock Pierce, the co-founder of Blockchain Capital, is trying to revive Mt. Gox.
Pierce’s idea entails a project called Gox Rising. Pierce claims to be the only shareholder remaining in Mt. Gox (Karpeles disputes this). He’s made it a mission to make sure others are paid a fair share of what remains of the Mt. Gox crypto assets, which are worth considerably more today than they were in 2014. Hundreds of thousands of BTC have never been recovered.
By distributing the cryptocurrency currently held by the Mt. Gox estate and reinstating the company’s operations, Pierce wants to reimburse every creditor of Mt. Gox through a process called rising civil rehabilitation, as CCN reported.
Between Bitcoin and Bitcoin Cash alone, the total could be roughly $700 million. Additionally, around $530 million was previously liquidated and is still held by Mt. Gox, for a total of around $1.2 billion in assets according to recent exchange rates.
Odds Stacked Against Relaunch?
As pointed out by CCN, for Pierce to operate a relaunched of Mt. Gox, a license from the country’s Financial Services Agency will have to be obtained. The question is whether the agency would grant the approval for the infamous, now-defunct cryptocurrency trading platform.
The community has responded positively to Pierce’ plans. Naturally, many welcome any initiative that could restore the reputation of the global cryptocurrency sector and reimburse longsuffering creditors.
Here’s a tweet from one supporter.
Hey @brockpierce My losses from MtGox inspired me to create the glass books transparency protocol in 2014 and then launch https://t.co/ZFal4LaVyS to be the most transparent exchange in the world. If you want help in the resurrection let's talk.https://t.co/NSL3XGEeuM
— Vaultoro J.Scigala (@Vaultoro) February 9, 2019
As Mt. Gox is remembered on the fifth anniversary of its collapse, there are two questions at the back of the minds of Bitcoin investors. “Will this happen again?”, and – of course, “Where is our money?”
Featured Image from REUTERS / Toru Hanai