Mt. Gox, the once-prominent cryptocurrency exchange that collapsed in 2014, is set to begin repaying creditors after a decade-long wait. According to a June 24 announcement, the exchange’s rehabilitation trustee will start processing payments in Bitcoin (BTC) and Bitcoin Cash (BCH) beginning July 2024.
The Tokyo-based exchange, which handled approximately 70% of all Bitcoin transactions at its peak, went offline in February 2014 following a massive security breach. The incident resulted in the loss of 850,000 Bitcoins, affecting around 240,000 users and dealing a significant blow to the nascent cryptocurrency market.
In preparation for the repayments, Mt. Gox recently transferred over 140,000 Bitcoins, valued at approximately $9 billion, to a new wallet. This movement, the first in over five years, caused a brief 2% dip in Bitcoin’s price.
“Please wait for a while until the repayments are made,” the rehabilitation trustee, Nobuaki Kobayashi, said in the announcement, stressing the complex nature of the repayment process.
“We have taken time to ensure safe and reliable repayment to creditors, including technical remedies for safe repayments, compliance with financial regulations in each country, and discussion of repayment arrangements with the cryptocurrency exchanges.”
Creditors will have the option to receive their repayments through direct transfer of cryptocurrency or via sale proceeds.
While this development marks a significant milestone in one of the cryptocurrency industry’s most infamous cases, the rehabilitation process has faced numerous delays. In 2022, a rumor spread that Mt. Gox was planning to dump the payout to its creditors in one giant 137,000-bitcoin offload. While this was shortly disproven, it was enough to cause bitcoin to go below the $20,000 mark.
The initial repayment deadline of October 31, 2023, has long since passed, and some experts caution that people might indeed need to wait for a while longer as further delays may still occur.
Information for this story was found via the sources and companies mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
