Creditors of infamous bitcoin exchange Mt. Gox may finally get their money back, or at least some of it, anyway.
According to a notice dated Aug. 23 and attributed to Mt. Gox trustee Nobuaki Kobayashi, the company has opened an online claim filing system so that creditors can begin registering claims on the funds that they lost when the exchange, once the dominant bitcoin trading platform, became insolvent in 2014. Creditors can also fill out claim forms offline and submit them through the mail.
As CCN.com reported, Mt. Gox went bankrupt after losing an estimated 850,000 BTC — most to hackers, but some to embezzlement — although former CEO Mark Karpeles later found about 200,000 BTC. The theft long remained the largest cryptocurrency exchange hack in history, and though it has since been surpassed by the Coincheck hack in Jan. 2018, it remains the most significant theft in terms of its impact on the industry as a whole.
Had the exchange remained in bankruptcy, creditors would have been compensated in cash at a rate far below bitcoin’s current market price. Meanwhile, Karpeles — who has been charged in Japan for embezzling funds from the exchange and spent nearly a year in prison while awaiting trial — would have likely received the excess funds accrued from the sale of the company’s remaining cryptocurrency assets, a payout that would have been worth hundreds of millions of dollars.
However, a Japanese court ruled in June that Mt. Gox could exit bankruptcy and commence civil rehabilitation proceedings. Moving the company into civil rehabilitation does not guarantee that creditors will be refunded in cryptocurrencies rather than cash, but the structure of this type of civil proceeding is much more flexible, which leaves the door open to a direct bitcoin distribution, depending on what stipulations appear in the court-approved rehabilitation plan.
According to the MtGox Cold Wallet Monitor, the company’s estate is holding 137,891 BTC, worth more than $910 million at the time of writing, as well as an equivalent amount of bitcoin cash, worth $73 million.
Importantly, all creditors must submit claims on their assets, including those who previously submitted claims as part of the company’s bankruptcy proceedings. The deadline for filing is Oct. 22. The trustee will then submit a list of approved and rejected claims to the court by Jan. 24, 2019.
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Last modified: March 4, 2021 3:33 PM