Mt. Gox Sets July Date for Compensation Payouts
Defunct crypto exchange Mt. Gox has announced its plan to start repaying investors in July, according to Rehabilitation trustee Nobuaki Kobayashi. The notice reads, “The Rehabilitation Trustee has been preparing to repay Bitcoin and Bitcoin Cash under the Rehabilitation Plan.”
Kobayashi continued, “Now that these preparations are in place, the Rehabilitation Trustee will commence the repayments in Bitcoin and Bitcoin Cash in due course to the cryptocurrency exchanges with which the Rehabilitation Trustee has completed the exchange and confirmed the required information for implementing the repayments. The repayments will be made from the beginning of July 2024.”
The notice also stated that Mt. Gox has established the necessary infrastructure to ensure safe repayment to creditors while complying with relevant regulatory requirements.
The rehabilitation trustee culminated the notice in a request for investors to exercise patience and await the conclusion of the repayment process.
The repayment of the Mt. Gox funds might significantly result in selling pressure for Bitcoin as the investors will return their assets at a much higher value than when they lost them during the turmoil in 2013.
Mt. Gox repayment notice has caused a drop in Bitcoin’s value. As of Monday morning, traders were selling Bitcoin at $63k, but following the announcement, its value dropped to $61k at press time.
The Genesis of Mt. Gox Crisis
After Jed McCaleb, the co-founder of Stellar Development Foundation and former Ripple CTO, launched Mt. Gox in 2010, he sold it to Mark Karpeles in 2011. That same year, hackers breached the company’s security, making off with more than 850,000 BTC, which they sent to invalid addresses. However, the company managed to recover around 200,000 BTC.
Before the security breach, Mt. Gox handled around 70% of all Bitcoin transactions and recorded about 150,000 transactions daily. However, according to the company, the company had to file for bankruptcy in February following a series of security incidents and unsuccessful business ventures.
Like its repayment notice, news of Mt. Gox’s bankruptcy caused Bitcoin to fall from over $600 to around $100 in less than a minute.
In May, the company moved over 140,000 BTC from its cold wallet to a new one, which led to speculation that Mt. Gox was gearing up to repay its creditors.