Mt Gox postpones creditor repayments deadline to 2025
The defunct crypto exchange Mt. Gox has officially extended the repayment deadline by 1 year. The deadline for paying back the exchange’s creditors was previously rescheduled from October 31, 2023, to October 31, 2024, before it was postponed until next year.
Mt. Gox gives reasons for extending repayment deadline to 2025
"The Rehabilitation Trustee, with the consent of the court, has changed the deadline for the repayments from October 31, 2024, to October 31, 2025 (Japan Standard Time) because it is desirable to make the repayments to such rehabilitation creditors to the extent reasonably practicable, Mt. Gox wrote in a release on Thursday.
The postponement temporarily allays worries that the price of Bitcoin (BTC) will decline due to selling pressure. According to a previous report, BTC dropped 3.38% to below $59,000 in July of this year, the lowest price since May. This occurred around the time Mt. Gox moved 47,229 BTC ahead of a payout of almost $9 billion.
Collapse of Mt. Gox
Founded in 2010, the Tokyo-based exchange Mt. Gox grew to become one of the largest bitcoin trading platforms. Since its inception, Mt. Gox has encountered many security issues. 25,000 bitcoins were stolen as a result of a significant security breach that occurred on the exchange in June 2011. Even so, Mt. Gox kept expanding, but its security practices were still a worry.
In 2014, it experienced a security breach that resulted in the loss of 850,000 Bitcoin, forcing the company to stop withdrawals and declare bankruptcy. When Mt. Gox declared bankruptcy in Japan on February 28, 2014, it disclosed that about 850,000 bitcoins, which were valued at about $450 million at the time, had vanished.
Investigations conducted after the collapse showed that Mt. Gox had been insolvent for a while and that significant quantities of bitcoin had vanished as a result of poor management and security. Authorities in Japan arrested Mark Karpelès in August 2015 on allegations of data manipulation and embezzlement. Karpeles was exonerated of embezzlement charges in 2019 but found guilty of falsifying financial records. He was given a prison term that was suspended.
History of Mt. Gox creditor repayments
The Tokyo District Court changed the case from bankruptcy to civil rehabilitation in 2018, giving creditors hope that they would be compensated. Although there have been many delays in the repayment process, there has been a lot of advancement in recent years.
The rehabilitation plan for Mt. Gox was filed in a Tokyo court in December 2020. It wasn't finalized until November 2021, though, after being approved by most creditors, which paved the way for repayments to start. Preparations for the repayment process continued throughout 2022. Following further delay of the repayment schedule, the period for creditors to file repayment claims formally began in April 2023.
Mt. Gox extends repayment deadline to October 2024
Repayments were originally anticipated to be completed by October 31, 2023, after the window opened. But in September 2023, the trustee declared that by a new deadline of October 2024, creditors would receive 142,000 Bitcoin and 143,000 Bitcoin cash, along with fiat money totaling 69 billion Japanese yen.
Some payments made to creditors
According to a letter today from the Rehabilitation Trustee Nobuaki Kobayashi on September 21, 2023, it stated that creditors who have already given the Rehabilitation Trustee the required information may receive repayments as early as the end of this year, with repayments being made in a sequential manner, notwithstanding the overall delay. The schedule is still subject to change, though, and the precise timing for each creditor is still unknown.
The Rehabilitation Trustee encouraged creditors who have not yet provided the necessary information to do so. The start of their repayments cannot happen without this information, the letter added.
Users reported receiving repayments in their bank accounts in fiat currency in April 2024. The following month, as it got ready for the start of cryptocurrency repayments, Mt. Gox started transferring billions of dollars' worth of bitcoin for the first time in five years.
Nobuaki Kobayashi, a trustee for Mt. Gox Rehabilitation, stated in June 2024 that it would finally start repaying Bitcoin and Bitcoin cash in early July 2024. Repayments officially started on July 5, 2024, when Mt. Gox transferred almost 47,229 Bitcoins to addresses associated with Bitbank and SBI VC Trade, two of the five companies chosen to oversee creditor repayments.
Following the transfer of approximately 48,641 BTC earlier that day, Kraken, another of the selected companies, confirmed on July 16 that it had received Bitcoin and Bitcoin cash from the Mt. Gox Rehabilitation Trustee.
Bitstamp began repayment on July 25, while the final exchange, BitGo, chosen for the creditor distributions, received $2.9 billion in BTC from Mt. Gox on July 30 and made a test transaction on August 13.
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