Mt. Gox’s Rehabilitation Deadline Extended by Judge
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Even though the hack happened five years ago, investors of Mt. Gox are still reeling from it. There were a lot of people who believed that restitution and reorganizing could help the exchange progress this year, it appears that this may take a bit longer. The exchange made an announcement earlier this week that its restructure plans were delayed till the end of the year, which is another blow to the hopes of investors about getting some of their funds back. A press release on the exchange’s website shows that an order has been issued by the Tokyo District Court for extending the company’s deadline to implement a rehabilitation plan.
The move came after the company’s rehabilitation trustee, Nobuaki Kobayashi proposed a motion and the process will be shifted to December 15th. Mt. Gox is a notorious name in the crypto space. The exchange suffered from two devastating hacks back in 2011 and 2014 and a total of 1.35 million BTC was stolen. Since then, the exchange has been trying to get back on its feet and has also been embroiled in a legal battle with its affected customers and investors. So far, the rehabilitation process has failed and several motions have been published by Mt. Gox for delaying it further.
In 2019, the company was granted two extensions and it already has one in 2020. The last extension was granted back in March. In the same month, a draft of the proposed rehabilitation plan for the exchange was revealed by Kobayashi. In the proposal, the exchange had claimed that claims made in Bitcoin, fiat currencies and Bitcoin Cash would be honored by it. The exchange would liquidate the ones made in other assets into cash, as much as possible. However, the exchange will first allocate funds to its rehabilitation plans and then pay off its creditors.
Fiat currency claims will be prioritized by the exchange when making payouts, followed by small payments that are under the range of $1800. Next, prorated payments will be dealt with. Apart from that, the company is also seeking approval from the court for selling off its debits in Bitcoin and Bitcoin Cash, which will provide it enough cash for bankrolling the process. Even though it seems that the exchange has thought it out, the delay will only add to the frustration of the creditors. Kobayashi said that the company had decided on a delay because they are still working on their rehabilitation program.
Even though a number of aspects are ready, there are some that need closer examination. While the company is working on its recovery, Mark Karpeles, the chief executive of Mt. Gox, is also facing some legal trouble. In the wake of the dissolution of the exchange, the CEO was found guilty of tampering with clients’ financial data. He has been fighting these charges for years now. He was sentenced to 30 months in jail for tampering with client data between February and September 2013, as he had deposited $33.5 million into his own account.
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