Nearly a decade after its notorious collapse, Mt. Gox, once the titan of Bitcoin exchanges, is on the brink of initiating a repayment plan for its creditors. In a recent email, the exchange’s rehabilitation trustee, Nobuaki Kobayashi, conveyed the plan to begin cash repayments within the 2023 calendar year.
This momentous step marks a pivotal phase in addressing the financial aftermath of one of the most significant collapses in the crypto world.
The Dawn Of Repayment?
According to the communication, due to the vast number of creditors and the diverse nature of their claims, the repayment process’s complexity indicates that although the initial round of compensation will begin this year, the complete repayment process is expected to extend into 2024.
However, according to the trustee, the dates when individual creditors involved in the Mt. Gox rehabilitation process will receive their repayments are undecided. Therefore, it is not “feasible” for the rehabilitation trustee to inform each creditor when they will receive their repayment.
Creditors will not know precisely when they can expect their funds until the repayment process is more concretely established and underway.
Some MtGox creditors received email from the bankruptcy trustee stating that the trustee plans to start repaying creditors soon and is working to start repaying them in cash in 2023 and will continue into 2024. Mt Gox will distribute 142,000 BTC, 143,000 BCH, and 69 billion yen,… pic.twitter.com/gWW29Zycl1
— Wu Blockchain (@WuBlockchain) November 22, 2023
The trustee’s recent notice also indicates meticulous preparations are underway, with a 7 billion yen ($46.9 billion) redemption from trust assets already executed to fund these impending repayments. Disclosing in another document, Kobayashi revealed:
We hereby announce that on November 17, 2023 (JST), the Rehabilitation Trustee received the redemption of JPY 7,073,684,082 from the Trust Assets as the amount necessary to fund the repayment of the Claims. The amount of the Trust Assets after such redemption is JPY 8,812,899,304.
Mt. Gox’s Turbulent Legacy
Notably, Mt. Gox’s story is etched in the annals of crypto history. Launched in 2010 in Tokyo, it rapidly ascended to dominate the global Bitcoin trade, handling 70% of all transactions by 2013.
However, the platform’s meteoric rise was abruptly halted in 2014 following a hack that resulted in a catastrophic loss of more than 800,000 Bitcoins. This led to a halt in withdrawals, trading suspension, and, ultimately, the exchange’s bankruptcy declaration.
The impending distribution, a mix of 142,000 BTC worth $5.1 billion at today’s price, 143,000 BCH worth $31.5 million, and 69 billion Japanese yen worth $467 million, is a crucial step in the rehabilitation process.
Creditors, eagerly awaiting restitution, are advised to stay abreast of updates through the claim filing system. The initial repayments will focus on smaller claims, with the first 200,000 yen per creditor paid in yen. In comparison, larger claims opting for mixed repayments will see a proportional distribution of around 71% in crypto and 29% in cash.
Featured image from Unsplash, Chart from TradingView