Creditors of the now defunct Mt. Gox Bitcoin Exchange may be one step closer to realizing the repayment of funds.
According to an Oct. 6 announcement from Mt. Gox trustee Nobuaki Kobayashi, creditors have until Jan. 10 to select a repayment method and to register payee information in an online rehabilitation claim filing system to be paid through bank remittance, fund transfer service provider, a cryptocurrency exchange or custodian. Kobayashi’s update is the latest development in a rehabilitation plan that began with a 2018 petition to compensate Mt. Gox creditors for their lost funds following the exchange’s collapse in 2014.
[Wright, T. Mt. Gox trustee sets registration deadline of Jan. 10 for repayment selection. (Accessed October 8, 2022)].
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"Creditors are also required to draft a note of several explanatory materials indicated in the notice. Some of these include filing information on the financial status of the defunct exchange, a notice of the trustee’s rehabilitation plan, the exchange’s income and expenditure statement, etc. To provide the required details, creditors will have to log on to the Mt. Gox “claims” platform and carry out the registration themselves. Failure to comply with the requirements will result in the creditor not receiving the due repayment" [Jima, L. Mt. Gox Trustee Sets Registration Deadline for Creditors to Receive Their Bitcoin (BTC). (Accessed October 8, 2022)].
[T]hose who complete the forms on time will be able to choose between these repayment methods:
- Early Lump-Sum Repayment
- Repayment for a Portion of Cryptocurrency Rehabilitation Claims in Cryptocurrency
- Repayment by Bank Remittance
- Repayment by Remittance through a Fund Transfer Service Provider
[Prospero, E. Will Mt. Gox Release The 140K BTC On January 2023? Repayment Methods Revealed. (Accessed October 8, 2022)].
It’s also worth noting that to receive payment in the selected method, these three names have to coincide:
- Creditor Name (the name notified to the Rehabilitation Trustee by the rehabilitation creditor)
- Name of Payee information (Name of the receipt bank account for a bank remittance, the account of a fund transfer service provider, and the cryptocurrency exchange/custodian account, etc.)
- Name set forth in the identification documents submitted by the rehabilitation creditor to verify identity using the service provided by Onfido PTE Ltd.”
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"Kobayashi said that his office or “third parties relating to the repayment” would confirm the names of those who registered matched those entitled to compensation, in addition to verifying the identity of residents for any address provided. It’s unclear whether the repayment plan included the option for creditors to receive Bitcoin or fiat, and how soon following the Jan. 10 deadline the funds will be distributed" [Wright, supra}.
"Given that the price of bitcoin was a fraction of the current market value of around $21,000, it has been speculated in the community that many creditors could choose to offload their bitcoin in the market for cash – directly or indirectly. That’s because, even though details weren’t shared, the trustee would supposedly liquidate an equivalent amount of bitcoin to pay out those interested in receiving fiat currency" [Namcios. 142,000 BITCOIN COULD BE DUMPED AS CREDITORS EYE MT. GOX REPAYMENT. (Accessed October 8, 2022)].
Mt. Gox users’ losses were estimated to be worth billions of dollars following the collapse of the crypto exchange. Roughly 99% of the creditors affected by the platform going under approved a draft rehabilitation plan in October 2021, with claimants representing roughly 83% of the total amount of voting rights voting yay. Kobayashi announced in November 2021 that the plan was considered 'final and binding' following acceptance by a Japanese court. However, the trustee noted in an Oct. 4 update that he had petitioned for certain amendments to provisions of the rehabilitation plan, which would 'have no adverse effect on rehabilitation creditors.'
[Wright, supra]
"The 140K BTC that Mt. Gox will release into the wild will for sure affect the bitcoin price, but maybe not as much as people fear. The different payment methods guarantee that everything will happen gradually. And the Mt. Gox class consists of early bitcoiners. They might’ve learned something along the way and not be so eager to sell their BTC. Those coins appreciated considerably since the Mt. Gox hack, but the price might go even higher in the future" [Prospero, supra].
"Meanwhile, Bitstamp stated earlier that it will be among the crypto trading platforms that will support the repayment plan" [Jima, supra].
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