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Tokyo Bitcoin Trustee Gains Court Extension for Mt Gox Crypto Rehabilitation

Last Updated March 4, 2021 2:44 PM
P. H. Madore
Last Updated March 4, 2021 2:44 PM

By CCN.com: The Mt. Gox trustee, who is in charge of distributing what remains of Mt. Gox’s assets to claimants, also known as “creditors,” put in for an extension on the filing deadline, which would have been today. The deadline has been extended about six months, to October 28th.

Get your claims in by October 2019

The trustee posted a note to the Mt. Gox website  yesterday stating that there are too many claims in various stages of dispute for a final decision to be reasonably reached based on current filings. They said, in part:

A large amount of rehabilitation claims that the Rehabilitation Trustee fully or partially disapproved remains undetermined for being subject to claim assessment procedures. […] It is expected that it will take some time before such undetermined rehabilitation claims are determined by the court, and a rehabilitation plan can be submitted.

According to Reddit posts, legitimate claims have been denied for small problems, such as not knowing the exact amount that was in one’s account. Blockchain analysts and law firms now have an additional six months to help such claimants.

Other delays likely

The leader of Mt. Gox Legal, Andy Pag, recently quit his post and sold his claim against Mt. Gox. One of the reasons he cited was that he did not have faith the case would be resolved in a reasonable frame of time. He took a massive loss on the value of his claim.

Mt. Gox
Mt Gox used to be the world’s largest bitcoin exchange. | Source: Shutterstock

People have been buying Mt. Gox claims for years, a gamble in the faith that eventually the matter will be resolved and the claims will be settled, in part or whole via Bitcoin. Some offers have paid as low as 15 cents on the dollar , while Andy Pag was able to get around $200 over and above what the coins were actually worth when he lost them.

Originally, Mt. Gox was only on the hook for the fiat amount owed to creditors, which was around $400 per coin at the time of its collapse. However, during the bull run of 2017, a general and loud push for a return to civil rehabilitation, as opposed to bankruptcy, successfully changed the course of events.

The Mt. Gox rehabilitation plan has had a monkey wrench thrown into it by a firm which consulted for Mt. Gox and had a lawsuit against the company at the time of its implosion. CoinLab currently has a pending $16 billion claim against the estate, which was initially rejected, but they may continue to appeal and delay the overall process. Their example could be followed by other creditors who feel they’re not getting the best possible deal, which could compound problems and delay the process for years.

The Japanese-based exchange set the bar for misbehavior early in the history of Bitcoin, and Japanese regulators have responded with a laser focus on later enterprises. Regulators recently paid unexpected visits to two exchanges and, allegedly, neither was deemed to be correctly protecting customer funds.