DEC 28, 2023
Mt.Gox creditors start to confirm receipt of first repayments
It’s been nearly ten years since the infamous collapse of the Japanese bitcoin exchange Mt. Gox, with some creditors of the defunct business now claiming to have finally received their long-awaited repayments.
Subreddit payment confirmations
Testimonies shared on the Mt.Gox creditor subreddit and a dedicated Telegram channel reveal that certain payments, in the form of Japanese yen, have been distributed to creditors who opted for PayPal as their preferred mode of receipt.
Excitement marked the early stages of this repayment process. Users on Reddit joyfully shared their experiences, with one exclaiming:
“I got money!! I just got my initial payment via Paypal!!”
This development comes after Mt.Gox rehabilitation trustee, Nobuaki Kobayashi, had previously extended the repayment deadline from Oct. 31, 2023, to Oct. 31, 2024. However, last month, Kobayashi informed creditors that certain cash repayments would be initiated before the year’s end. Despite efforts to expedite the process, the sheer volume of creditors and the complexities involved mean that repayments will continue into 2024.
The collapse of Mt.Gox in early 2014 triggered global regulatory responses and initiated a nearly decade-long bankruptcy and corporate rehabilitation process. The exchange fell victim to a series of hacks between 2011 and 2014, leaving a lasting impact on the cryptocurrency landscape.
The commencement of repayments has been hanging over the crypto market for many years, with many fearing that the process may have a dampening effect on the Bitcoin unit price, given that funds are being distributed in Japanese yen and Bitcoin.
Earlier this year, the U.S. government indicted two Russian nationals for laundering funds stolen from Mt.Gox, shedding light on the enduring legal ramifications stemming from the exchange’s demise.
Double payment glitch
However, it appears the process encountered some glitches, as other Reddit posts indicated that a few creditors received double payments via PayPal, adding a new layer of complexity to the already intricate Mt. Gox saga.
Reddit users, such as u/rlycreativename, have shared emails they claim to have received from the Mt.Gox Rehabilitation Trustee. The emails acknowledge a system issue leading to inadvertent double transfers and legally obligate recipients to return the surplus amount.
While some users have complied with the request and returned the duplicated funds, others have expressed hesitancy, citing the historical challenges creditors faced in obtaining their money. The situation has evoked discussions on Reddit, with users debating whether the Trust deserves a swift return, considering the prolonged struggle creditors endured to reclaim their funds.
While it may be tempting for some creditors to hold on to the duplicate payment, such a decision may only serve to heap more misery on long-suffering Mt.Gox creditors. The recent case of Jatinder Singh and Thevamanogari Manivel would be very relevant for creditors to consider.
Singh was a customer of well-known digital assets platform Crypto.com. In 2021 the firm inadvertently transferred $10 million to his account. Singh conspired with Manivel to withdraw and keep the funds. A community corrections order of 18 months has been imposed on Manivel in Australia while Singh will be sentenced in February.