Mt. Gox trustee has new plans for repaying creditors
Any remaining claims could be paid in fiat and not in cryptocurrency
An extinct cryptocurrency exchange – one that brought the crypto industry to its knees just as it was getting started – has set up a plan to repay creditors their losses. The trustee for the Mt. Gox exchange, which went bankrupt in 2014 amid a serious amount of controversy, has drafted a rehabilitation plan that will see claims for fiat currencies as well as Bitcoin (BTC), and Bitcoin Cash (BCH), honored in the form requested. However, other crypto assets “will be liquidated into cash to the extent possible.” The trustee is planning on liquidating all the funds, but first, they will be assigned to cover the rehabilitation plan for repayments so that creditors can receive the funds thereafter.
According to the plan, all payments will be organized in a way that priority payments can be made first to make sure the interests are covered in any fiat currency claims. All other payments will follow up gradually but in small increments of up to $1,800 approximately, then prorated payments are to follow. This draft plan allows users who “may, with the permission of the court, sell all of part of the BTC/BCH constituting the debtor’s assets” to ensure that “a sufficient amount of cash” is secured.
The trustee, attorney Nobuaki Kobayashi does not have any plans to acquire additional BTC/BCH, which means that some creditors who want to take the funds out in form of crypto might receive partial payment in fiat currency. “It is possible that there will be an insufficient amount of BTC/BCH as the source for distribution,” said Kobayashi.
Roughly 24,000 creditors have been impacted by the hack that the exchange suffered and that led it to collapse in 2014. A total of 850,000 BTC were lost; at the time worth more than $425 million. The trustee has until the end of the month to put together the final version of the rehabilitation plan.