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Draft Rehabilitation Plans Now Underway For Mt. Gox Creditors

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After waiting for 5 years, the users of infamous exchange Mt.Gox could be getting their funds back very soon. The exchange will be returning the creditors’ funds either in cash or in cryptocurrency, according to the draft rehabilitation filed by the exchange’s trustee Nobuaki Kobayashi.

Already, 792.296 Bitcoin cash, 803.512 Bitcoin, and other amounts have been approved as compensations to the victims who lost their funds after the exchange was hacked in 2014. Based on the initial announcement on the Mt.Gox website, an examiner and the Tokyo district Court will review the rehabilitation plans and decide whether to go on with the proceedings.

Nearly six years ago, Mt.Gox was the most popular Bitcoin exchange in the world with massive accumulation of Bitcoin and a huge user base. The exchange accounted for over 50% of BTC trading volume. However, the exchange was hit by the biggest crypto hack in history against any company in two series of attacks. The exchange lost a combined total of 1.35 million Bitcoin after two hacks in 2011 and 2014.

The creditors raised a petition against the company to prevent a total loss to them. To that end, they petitioned the officials handling the bankruptcy to allow the company settle the case under civil rehabilitation.

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Creditors eagerly anticipating funds

The rehabilitation submission deadline has been postponed several times, and the creditors expect this submission to be the last one before claiming a part of their funds. The move is coming after another approval to extend the submission deadline came in October. However, the latest deadline has picked December 15, 2020 as the rehabilitation submission date, after series of deadlines in April 2019 and March 2020 were shifted.

Shortly after the 2014 hack, Mt.Gox users and customers requested for their funds to be returned. But since then, they have not received any funds neither have they received compensation for the funds. Japanese lawyer Kobayashi was charged with the responsibility of overseeing the civil reimbursement process. He says there are about 150,000 BTC available to pay users.

Some other crypto exchanges have suffered similar fate as Mt Gox, but not in the same magnitude. As recently as December 9, the liquidator of the defunct crypto exchange Cryptopia began its fund reimbursement process to users after suffering a massive hack last year.

Although the rehabilitation plan doesn’t contain any details, the announcement has been greeted with relief and excitement as the users are much closer to getting compensation for their funds since 2014.

The Mt. Gox reimbursement funding is coming from Bictcoin cash created during the Bitcoin fork, as well as from 200,000 Bitcoins discovered in an old wallet after the exchange went bankrupt.

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      A journalist, with experience in web journalism and marketing. Ali holds a master's degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.