Mt. Gox will give back $1.3M worth of Bitcoin to its users – but there’s a catch

mtgox

#1


via tnw

Creditors of the now disbanded Mt. Gox cryptocurrency exchange have made another step towards reclaiming their lost Bitcoin, following updates to a court ruling issued in June, first spotted by Coindesk.

Back in November 2017, a group of Mt. Gox creditors, who were implicated by the theft of over 744,000 Bitcoin $BTC▼2.05% and the exchange’s subsequent bankruptcy rallied together, and started a petition to reclaim their lost funds.

Over the following months this gained traction, and in June of this year a further court session ruled that the compensation claims should be made in BTC and BCH, which at current market rates would be valued at over $1.3billion USD. The update further states that the payments should be made via easy-to-access exchanges, that creditors are likely to have accounts with, or where accounts can easily be set up.

For any creditor that had cryptocurrencies that weren’t BTC or BCH, payments will be made in cash. The ruling deemed it impractical to convert altcoins back to BTC due to the higher volatility of alternate cryptocurrencies, and the marginal values that Mt. Gox actually traded in altcoins.

So far, the courts have supported the creditors endeavours to try and reclaim their lost funds. The support of this further ruling takes them one step closer to this becoming a reality, and restoring their digital asset wealth – and then some, due to Bitcoin’s growth in value since 2014 when the Tokyo based exchanged first filed for bankruptcy.

However, there is no mention of the sum total of what is trying to be claimed, but what the update from the claimants states, is the Mt Gox does not hold enough BTC to fully compensate all those involved. How these funds will be divided amongst the creditors is yet to be confirmed.

That said, given Bitcoin’s growth in value, it is wholly possible that some of the creditors will receive compensation that far exceeds the fiat value of the BTC or BCH they originally held.

But for this to happen, the final ruling still needs to be approved. The next court date is currently scheduled to happen in May or June of next year, where it will be decided if the proposed rehabilitation plan can realistically be actioned.

If successful, compensation payments will be actioned swiftly, but until then, the actual value creditors will gain back will be subject to BTC’s and BCH’s inevitable fluctuations in price.

But overall, this is a positive step for those potentially nervous because of the risks of exchanges liquidating and filing for bankruptcy. It seems that legally speaking, it will be harder for cryptocurrency exchanges to shortchange customers and disappear with their funds in future.


#2

@john shouldn’t the title be billion not million?


#3

This makes for the best forced hodlers if the majority are able to get their money back. Very few of them would’ve actually held btc for this long.


#4

I remember I ran in to Bit Coin at that time. I should have learned more. When i saw Mt. Gox happened I just dismissed the tough of even trying to get in too it. But at least I am in it now and understand it a bit more.


#5

It would be nice if I were to be somehow re-reimbursed for the 100+ Dash I had sitting in that damn black hole when it collapsed.


#6

Daum dude you where in Crypto at that time? They Had other currencies besides Bit Coin? That Dash is strong.


#7

I was indeed. Dash used to be called DarkCoin. They rebranded because they thought the word ‘dark’ wasn’t benefiting the growth they were looking for. Dash has been over a $1000 dollars per token…so yea…I lost a little bit of money.


#8

Wow thank’s for sharing. I was thinking the other day what if I would have Bought Bit Coin back then. Young me would have still screwed that up as soon as it hit $100 I would have sold lol. I was just in a different place in life where I was living in the moment and not thinking of the future.


#9

Many, including myself, stood more safely on the sidelines watching the mtgox situation build until it imploded. It caused a lot of uncertainty for me trying to get more traction in the space. I recall several times I dismissed the whole idea as FUBAR. Only to eventually come back and jump in head first! LOL Good times!

I have spoken to some who are involved with this mtgox case and they claim to have been notified that they will be issued both Crypto and Fiat. They say it is really going to depend on a case by case basis.


#10

I hope some of those mtgox people get something. I saw them all over the news when that hit,standing out in the cold.