Mt. Gox Saga Continues as Bitcoin Stabilizes Near 6.5kby MBM Research MBM Research
Cryptocurrency investors are watching for the next trends in price as the Mt. Gox Saga continues with historic court rulings out of Japan. Last month, a Tokyo District Court ruling halted Mt. Gox's bankruptcy proceedings in favor of civil rehabilitation, which means that creditors stand to collect a substantial base that might have otherwise gone to former CEO Mark Karpeles. This also means that creditor claims will be paid in bitcoin at its current value (rather than bitcoin's 2014 fiat value).
In light of these recent developments, one of the world's largest Mt. Gox creditors (with a claim worth close to $250,000,000) has retained internationally-renowned attorney Oliver Wright to explore litigation financing.
All of this comes at a critical time for bitcoin and its investors. June typically marks the beginning of the summer trading season and the period was characterized by more volatility than is normally seen. During the third week of June, the cryptocurrency block added $12 billion to its market-cap - and Bitcoin jumped to $6,700 after bouncing out of prior support levels near $6,300.These figures are still far below the peaks it achieved in May (when bitcoin rose back toward the $10,000 psychological level). But markets have fallen since then, and many have wondered if the crypto ship has sailed for investors seeking value in otherwise elevated markets.
Historic Ruling in Tokyo
This most recent historic ruling in a Tokyo district court ordered Mt. Gox to pay its customers in ways viewed as more equitable. How would the ruling help the bitcoin owners that had lost their assets? The following points give us more a clear picture:
- In June 2018, the Tokyo District court halted Mt. Gox’s bankruptcy proceedings and put the defunct company on the path of rehabilitation
- A civil rehabilitation leads to compensation of the assets in the form of the original asset, and not in terms of national currency value
- The court has ordered Mt. Gox pay the customer in bitcoin, that too as civil rehabilitation charges and not under bankruptcy charges
- Customers have to file their claims by October with proper documentation to prove that their currencies were stolen
This ruling comes as a welcome respite to legitimate stakeholders, as they can receive bitcoins at their current market value (while the previous liquidation price per bitcoin came to only $440). One of the biggest creditors of Mt. Gox owns 35,000 bitcoins, and has retained Newport Beach Attorney Oliver Wright, Esq to explore legal financing options.
In outlining further details on the situation, Mr. Wright explains:
“Given that the Mt. Gox bankruptcy stay and conversion to civil rehabilitation effectively resets the claim process, I’m interested to see if the trustee takes this opportunity to rethink his stance on some issues. He’s been less than transparent on critical decisions ranging from his refusal to use blockchain wallet addresses to validate claims, to his off-market bitcoin sales, to the role of interested third parties like Kraken on his decision making."
"Keep in mind that we still have 650,000 bitcoin that disappeared without a trace from Mt. Gox customer wallets. I know a few creditors and at least one appellate court that might disabuse him of the notion that the company doesn’t bear responsibility for that loss. His decisions have not been scrutinized. Maybe they need to be."
These recent rulings in Tokyo could have a dramatic impact on sentiment both for individual investors and for the cryptocurrency community-at-large. If the world can see cryptocurrency malfeasance handled in an appropriate (and fair) fashion, it will become much easier to legitimize digital assets and bring added legal security to the space.
Created on Jul 6th 2018 10:50. Viewed 234 times.