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Mt Gox Rehabilitation Plan Approved By Virtually All Creditors

Creditors of Mt Gox, a former Japanese Bitcoin exchange, have finally agreed to a rehabilitation plan after seven months of voting. For those who don’t know, hackers reportedly attacked Mt Gox in 2014, and stole thousands of its customers’ Bitcoin reserves. Now, the project will return a fraction of those bitcoins to its customers, which still amounts to over $9 billion.

Rehabilitation On The Way

As indicated in a report released earlier today, over 99% of creditors approved the rehabilitation plan almost unanimously. The project was first filed in February 2021 but voted upon by creditors today at the Tokyo District Court.

The confirmation order of the plan should become final and binding in November 2021. After that, Rehabilitation Trustee Nobuaki Kobayashi will have to repay creditors their claims. However, details on the specific timing, procedures, and amount of these payments are not public yet.

According to the report, creditors will have to register their bank account information in an online system to get receive payment. Almost $1.7 billion should come in fiat. Meanwhile, another $9 billion will be Bitcoin payments. Some creditors will receive compensation with a share of 142,000 Bitcoin Cash tokens from Kobayashi.

Creditors can elect to receive up to 90% of the Bitcoin the exchange owes to them under the proposal. This same Bitcoin is worth tens of times more than what they were in 2014. Therefore, the upcoming repayment to creditors is likely to make many people quite rich. Bitcoin’s price reached an all-time high earlier today, so there is no better time to be compensated in BTC.

Tremendous Amounts of Money

As of September 2019, trustee Kobayashi held 141,686 Bitcoins, alongside cash and Bitcoin Cash, on behalf of clients. This was more than five years after the exchange lost over 850 000 bitcoins after an alleged hack. 850 000 Bitcoin is about 4% of Bitcoin’s maximum supply. It was about $500 million worth at the hack and over $55 billion worth today.

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Avi Felman, a portfolio manager at BlockTower Capital, believes the day creditors receive their BTC could see a significant market event.

“It’s a date every market participant needs to keep their eye on. [There] will likely be significant volatility around the event, and if Bitcoin is overheated, it could mark a local top as holders finally are able to take profits on their positions.”

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