Largest Creditor of Bankrupt Mt. Gox Exchange to Hold Onto Returned Bitcoin – Huge Selling Pressure Averted?
As the bankruptcy proceedings of Mt. Gox continue, new developments have emerged regarding the Mt Gox Investment Fund, the exchange’s largest creditor. According to reports, the fund has no intentions of selling the tokens it is due to receive later this year.
A person familiar with the fund’s activities who asked not to be identified told Bloomberg that the Mt Gox Investment Fund’s strategy is to hold the digital assets that are scheduled to be returned this October.
Rather than waiting for the completion of all the litigation surrounding Mt. Gox’s collapse, the entity chose to receive an early payout. As part of the arrangement, the Mt. Gox Investment Fund is set to receive 90% of what can be collected, with a ratio of approximately 70% Bitcoin (BTC) and 30% cash, according to an anonymous source.
The deadline for the Japanese platform’s creditors to register the payment method under which they desire to receive claims is on April 6.
Japanese lawyer Nobuaki Kobayashi, who serves as the Mt. Gox trustee, stated in a letter released earlier this week that “[r]ehabilitation creditors who have not completed the Selection and Registration by the deadline will not be able to receive any of the repayments below.” The accompanying list of repayment methods comprises the following:
- Early Lump-Sum Repayment
- Repayment for a Portion of Cryptocurrency Rehabilitation Claims in Cryptocurrency
- Repayment by Bank Remittance
- Repayment by Remittance through a Fund Transfer Service Provider
“Please note that rehabilitation creditors who have already completed the Selection and Registration do not need to perform the Selection and Registration again. Please also note that these creditors may change their Selection and Registration up to the deadline,” according to the letter.
As the Japanese trustee has as much as BTC 141,686 under its control, with a current value of about $3.06 billion, many industry observers have been afraid that the release of the Bitcoin from the Mt. Gox trove could trigger a major selling push in the crypto market. However, the fund’s reported decision could mean that this scenario will be averted.
The Tokyo-based Mt. Gox was once the largest crypto exchange in the world, but it filed for bankruptcy in 2014 after some 850,000 BTC went missing. The exchange’s creditors have until April 6 to make a decision on whether to choose the October payout, or wait for a longer period of time to retrieve a higher share of their claims.
