A court in Japan ruled this June 22nd that Bitcoin Mt. Gox’s exchange is coming out of bankruptcy, creating the opportunity for at least $1 billion in cryptocurrencies to be refunded to the company’s former clients.
The decision was a surprising result for victims who suffered possibly the most bitter event in Bitcoin’s history. Mt. Gox was the world’s largest Bitcoin exchange and collapsed in early 2014 after realizing that had lost all the cryptocurrencies owned. We are talking about 850,000 Bitcoins valued at approximately $473 million at the time.
Hacked Into Mt. Gox
The hacking of Mt. Gox is still the biggest Bitcoin theft in history. And while the theft was happening 200,000 Bitcoins could be immediately safeguarded by the then CEO of Mt. Gox, Mark Karpelès. So the money was transferred to a freezing lockdown and the Tokyo-based company was subsequently declared bankrupt.
In recent years, Mt. Gox’s creditors had no answer as to when they would receive a refund. This despite the fact that the value of its recovered assets soared to over $4 billion when Bitcoin’s price peaked last year.
But that all changed this week when the Tokyo District Court interrupted the bankruptcy proceedings against Mt. Gox and initiated a legal process known as “civil rehabilitation”, which will allow for the distribution of the remaining assets of Mt. Gox.
Equity includes nearly 170,000 units of Bitcoins and its subsidiary Bitcoin Cash, worth approximately $1.2 billion at current prices.
“Enormous assets…will be refunded to creditors of Mt. Gox,” Shin Fukuoka, a leading attorney and partner at Japan’s Nishimura & Asahi law firm, who petitioned the Court for civil rehabilitation on behalf of a large creditor, wrote in a statement. “This is the creditors’ victory.”
The Court of Justice also confirmed that the persons requesting the refunded of Bitcoins will be paid in this way. Creditors will only be entitled to receive the monetary equivalent of the value of their Bitcoins at the time of the company’s collapse, i.e. when the price of the cryptocurrency was approximately $483.