Mt. Gox begins repaying users after a decade of collapse

abdelaziz Fathi

Creditors of the now-defunct bitcoin exchange Mt. Gox have reportedly started receiving repayments, marking a major milestone in one of the cryptocurrency world’s most prolonged sagas.

According to emerging reports on social media, including Reddit and Telegram, some creditors confirmed receiving payments through PayPal, with the repayments denominated in Japanese yen.

Several Reddit users from the r/mtgoxinsolvency page have shared their experiences of receiving payments. One user, Free-End2543, attached a screenshot of a PayPal notification as proof of payment. Another user noted that they received only a portion of their Bitcoin claim, getting about 30,283 yen (nearly $200), with a remaining balance of about $748 yet to be paid.

Repayments to creditors are being carried out in various tranches, including the base repayment, the early lump-sum repayment, and the intermediate repayment. The first instances of these new repayments were reported on December 21, when a user on X (formerly Twitter) claimed to have received their Mt. Gox claims through a bank transfer.

These repayments come after Nobuaki Kobayashi, the trustee responsible for managing Mt. Gox assets, said in November they plan start the repayments within this calendar year, although the process is expected to extend into 2024 due to the extensive number of creditors involved. However, he cautioned that the repayment schedule is still subject to changes depending on the prevailing circumstances, and the exact timing of repayments to individual rehabilitation creditors has not been finalized.

Additionally, Kobayashi disclosed that on November 17, Mt. Gox’s liquidators redeemed 7 billion yen ($46.9 million) from trust assets to facilitate these repayments. After this redemption, a balance of 8.8 billion yen remains in the trust assets.

This announcement follows a previous extension of the repayment deadline, indicating a protracted process ahead for the defunct exchange’s many creditors awaiting the return of their funds.

October 31, 2024 will serve as the new deadline for base repayment, early lump-sum repayment, and intermediate repayment. Having obtained the permission of the court, the business’s Japanese bankruptcy trustee pushed back the deadline from its previous October 31, 2023 date.

Bitstamp and BitGo were appointed by Mt. Gox trustee as some of the designated crypto exchanges to assist in the repayment procedures to creditors. A creditor can choose his preferred cryptocurrency exchange and register as a user for the receipt of the relevant assets according to the repayment procedures under the rehabilitation plan.

Almost a decade after an attack forced the platform to shut down, Mt. Gox creditors were given the option to choose between bitcoin, cash or Bitcoin Cash to receive repayment. The process could make the frozen crypto assets liquid again, depending on the entitled users’ choices.

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