Not only will Mt. Gox’s former customers finally be compensated for their lost Bitcoins, but they will likely end up with more money than what they had lost.
Mt. Gox has become one of the most well known Bitcoin exchanges, even though it is no longer in operation The Tokyo-based exchange collapsed into bankruptcy in 2014 after then-CEO Mark Karpelès realized the exchange had lost its customers’ holdings of 850,000 bitcoins (worth only around $414 million at the time). Hackers had been stealing BTC from of the exchange, and it became the biggest cryptocurrency theft in history.
A court decided last week that creditors are entitled to receive their claims in Bitcoin rather than the cash value at the time of the hack. This is in line with the definition of Bitcoin and many of cryptocurrencies as true mediums of exchange, rather than investments securities or anything else of that nature.
More importantly for the customers, the difference is will total hundreds of millions of fiat dollars. Bitcoin has risen from around $485 at the time of the bankruptcy to $6,150 - nearly a 1300% increase.
However, no explicit date has been stated for payment. It was just a few months ago that Bitcoin was well over $10,000, and as high as $20,000, meaning that Mt. Gox customers payouts could even double or more from what they would be at the current time.
What could go wrong?
Creditors have until October to file their proof of rehabilitation claims and a proposal plan is due by Feb. 14, 2019. Some have sold their claims to third-parties who speculated on the outcome, and so will no longer be entitled to the windfall.
Forgotten passwords could also be an obstacle: Some creditors have forgotten or deleted the credentials needed to make a claim, if chatter on the sub-Reddit for Mt. Gox creditors is anything to go by.
By: BGN Editorial Staff