The trustee of now-defunct Mt. Gox, once the world’s largest Bitcoin trading venue, wants to keep the floodgates open for victims by extending the period for submitting their rehabilitation claims after the initial deadline has already passed.
After years of legal struggles, the victims of the Mt Gox hack were allowed to file a claim for a refund of their investments until October 22. But in a press release, the court-appointed trustee in Mt. Gox’s bankruptcy said that since the creditors are located worldwide, he wants to extend the deadline until December 26, to allow everybody time to have the stolen money returned.
“Considering that creditors in the Civil Rehabilitation Proceedings are located worldwide, and that a certain period of time is required for proofs of rehabilitation claim forms to be delivered, among other factors, the Rehabilitation Trustee will make efforts to request the court to accept proofs of rehabilitation claims received by December 26, 2018 (Japan time),” he said.
In addition, Kobayashi will keep accessible the online tool for submitting the claims,. It should be noted that the initial deadline allowing victims to file proofs of bankruptcy claims was set for individuals, but claims for corporate creditors were allowed to be filed later in August.
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The civil rehabilitation is not used to resuscitate Mt. Gox business but rather as a more flexible form of bankruptcy. It also allows the trustee to create his own plan instead of following a rigid set of steps under the bankruptcy proceedings. And most importantly, the bitcoin claims will be able to be revalued – hopefully in bitcoin this time.
Against Interests of the Shareholders
Mt. Gox went offline in 2014 in the single biggest setback in the history of Bitcoin after 850,000 bitcoins were stolen in a hacking attack. Under suspicious circumstances, the Japanese exchange claimed it had lost track of about 750,000 bitcoins belonging to customers and another 100,000 of its own, but later said it had found 200,000 bitcoins.
Those assets, currently valued at nearly $1 billion, was supposed to be distributed to shareholders as part of the liquidation. This is because the value of creditors’ claims is calculated in the exchange rate between Bitcoin and the Japanese yen on the bankruptcy date in April 2014, instead of current rates.
However, the rehabilitation ruling isn’t in the financial interest of the shareholders. Mt.Gox has two shareholders, Tibanne and Jed McCaleb. The Tokyo-based exchange is 88 percent owned by Tibanne, of which Karpelès is the sole owner. The remaining 12 percent are held by Mt. Gox’s original creator Jed McCaleb, a San Francisco-based programmer who currently works with Stellar.
Earlier in March, the trustee sold nearly $400 million worth of Bitcoin and Bitcoin cash to generate proceeds to pay back creditors. At the time, cryptocurrency traders blamed the sale of Mt. Gox’s holdings for negatively impacting Bitcoin’s price.