Mt gox ‘Discovery’: US Lawyers not convinced.

March 22, 2014

Mt gox’s announcement, yesterday, that it had ‘Discovered’ an old format wallet containing almost twenty-five percent of the missing bitcoins is being viewed as highly suspect.  The bankrupt exchange has found the missing coins at a time when many are paying careful attention to blockchain transactions. Indeed I wrote on this myself on March 9th in an article entitled “$113 Million of missing bitcoins may be moving through blockchain.” Mt gox has announced that they immediately informed the relevant authorities of the substantial recovery, however, one man isn’t quite buying their story.

Chris Dore is a partner at a law firm involved in representing clients in a US class action against the bankrupt exchange. His firm Edelson Law is currently investigating events up to the collapse of Mt gox, and it is Dore’s belief that the announcement is merely an attempt to stem a growing suspicion that these bitcoins were being prepared to be broken into smaller wallets and then further dispersed.  He stated: “Their statement that they found (these bitcoins) in a random wallet and failed to tell anyone for two weeks is highly suspect.”  He went on to state that it was his belief that these were probably the 180,000 that had been discovered moving through the blockchain on or about the seventh of March. This was reported in Cryptocoinnews on March 9th.

Chris went on to further state: ” We believe that that we were on the right trail.  It appears that these 180,000 to 200,000 bitcoins were being tumbled. That they were being broken down and reconstituted so our goal was to find this out.” Dore seems to believe that declaring these funds to be discovered may be a ploy to hold up further investigations into the missing funds.  Dore went on to say: “If it’s a coincidence, it’s a $120 Million coincidence. We frankly just don’t buy it.”

Edelson Law yesterday applied to the courts for a relaxation of the restrictions on Mt gox assets in order to make it easier to investigate their transactions and help to seek to ‘discover’ further funds. Dore is quite skeptical about the motives at Mt gox stating that: “they found it in a wallet and they were breaking it down into hundreds of thousands of smaller wallets, it raises a lot of questions about their honesty and whether they are being forthright about what they have.” Dore was unwilling to state exactly how much he knew, but he seemed to believe that it would have been interesting to track the transactions to see where they would finally end up. Interestingly the investors that have lost funds are not currently being treated as creditors within the bankrupcy hearing and Mt gox is attempting to have it’s US assets shielded until the conclusion of it’s bankruptcy hearings in Tokyo. The next court hearing, is scheduled for April 1st in Japan. Let us only hope that the date chosen is not indicative of their attitude towards their clients. This may be a futile hope in an organisation that has treated it’s investors with an attitude of nothing less that open contempt. Cryptocoinnews will keep you appraised of developments.

Last modified (UTC): March 22, 2014 13:33

PJ Delaney @P.J. Delaney@delboyir

Masters in Public Administration, Bachelors in Mgt., I live in Ireland, I have a bit of a background in Economics and lots of opinions on everything else.