Investors Offer One Bitcoin for Mt. Gox

April 12, 2014 11:27 UTC
An investor group offered one bitcoin for defunct exchange Mt. Gox.

An investor group offered to purchase dead bitcoin exchange Mt. Gox Thursday, reports the Wall Street Journal. As of the paper release, bitcoin are worth approximately $400 a piece. The investors want to reinvigorate the controversial exchange and spruce up its sullied reputation. According to the plan, 50% of all the company’s profits, derived from transaction fees, would be put towards paying back depositors who lost their money in the Mt. Gox incident earlier this year. Reuters explains:

The bitcoin exchange’s creditors would have the option of receiving a prorated payment from the 200,000 recovered bitcoins, an estimated 20 percent recovery value on their claims, or receiving the equivalent amount in equity in the new exchange, the paper said.

According to the investor’s paper, the “information vacuum” over the missing bitcoins prompted the lowish offer. Mighty Ducks actor Brock Pierce, now an entrepreneur who promotes digital currencies, is a part of the group. Investors William Quigley and Matthew Roszak are also involved. Mt. Gox was the first Bitcoin exchange. Not long ago, it was handling 70% of bitcoin transactions. The Tokyo-based exchange saw a rapid demise in February after losing 750,000 bitcoins ($400 million). It pinned the loss on the controversial “transaction malleability” problem. Essentially hackers gradually stole bitcoins by taking advantage of a security flaw. This version of events has been scrutinized endlessly, most recently by the Swiss Federal Institute of Technology in Zurich which Crypto Coins News reported on a couple of days ago. Many speculate fraud and mismanagement of funds. The exchange filed for bankruptcy in February. CEO Mark Karpeles has been asked to appear in U.S. hearings. But a noteworthy lawyer speculates that he would likely be arrested “as a person of interest.” Japanese lawmakers decided not to impose new regulations in the wake of the Mt. Gox fiasco. Regulators treat virtual currencies as a commodity rather than a financial product or a currency in the country. Thus, they are taxed. Nevertheless, a Japanese court would have to approve the sale. The meager bid, while possibly an accurate calculation of Mt. Gox’s worth, might be rejected.

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