Creditors of the now-defunct Mt. Gox exchange are on the verge of finally receiving repayments, according to emails from the bankruptcy trustee on Nov. 22.
The bankruptcy trustee, Nobuaki Kobayashi, shared this news through email to affected clients, stating that repayments are expected to commence in 2023.
These long-awaited reimbursements will be financed through the sale of Mt. Gox’s remaining assets, including 142,000 BTC, 143,000 BCH, and 69 billion yen (about $625 million).
While a substantial portion of these assets has been liquidated, some are being held back to facilitate the repayment process.
SEE: Mt Gox’s BTC and USD value
Creditors were reassured in the email that they need not take immediate action and should patiently await the commencement of repayments.
Kobayashi reiterated his commitment to transparent communication, consistent with previous statements prioritizing creditor engagement throughout the repayment procedure.
Despite the positive development, the exact timeline for individual repayments remains uncertain due to the extensive list of creditors and diverse types of repayments.
Repayments are expected to continue until 2024 due to the sheer number of rehabilitation creditors.
Once the largest bitcoin exchange globally, Mt. Gox collapsed in 2014, filing for bankruptcy protection after losing over 800,000 bitcoins, accounting for more than 70% of Bitcoin transactions at its peak.
The exchange’s prominence made it a target for hackers, facing security problems multiple times during its operational years. In 2011, hackers used stolen credentials to transfer Bitcoins.
In the months leading up to February 2014, customers expressed increasing frustration with problems withdrawing funds.
Technical bugs prevented the company from having a firm grasp on transaction details, including uncertainty relating to whether Bitcoins had been transferred to customers’ digital wallets.
That same year, deficiencies in network protocols resulted in several thousand Bitcoins being “lost.”
The fatal blow occurred in February 2014 when the exchange suspended withdrawals, claiming suspicious activity in its digital wallets. The company discovered it had “lost” hundreds of thousands of Bitcoins.
Reports on the number of coins lost ranged from 650,000 to 850,000.
While it later located 200,000 Bitcoins, the missing cryptocurrency profoundly destabilized the market, estimating the value in the hundreds of millions, pushing Mt. Gox into insolvency.
It filed for bankruptcy in the Tokyo District Court and was ordered to liquidate in April 2014.