Mt Gox 150,000 Bitcoin rehabilitation plan: Do users need to wait longer?
Mt Gox was a Bitcoin exchange based in Tokyo, Japan that went bankrupt and halted all withdrawals in Feb 2014 after more than 850,000 BTC were supposedly lost to hackers, with 200,000 bitcoins recovered 2 weeks later. At the time, Bitcoin was trading at around $700 and Mt Gox was responsible for handling around 70% of Bitcoin spot market transactions. The event caused several early Bitcoin investors to lose their holdings.
After years of legal battles, the Tokyo District Court appointed Nobuaki Kobayashi as trustee who will formulate the rehabilitation plan and distribute about 150,000 Bitcoin to compensate users for losses. The original Mt Gox’s rehabilitation plan was supposed to be submitted to the court in Feb 2019, however, the court pushed the deadline at least three times upon the request from the trustee.
Dec 15, 2020, is the latest deadline in the Mt Gox rehabilitation process. By that date, the trustee shall provide the rehabilitation plan. Once approved by the court, the trustee will proceed with the distribution of 150,000 Bitcoin from Mt Gox’s wallet to the creditors.
Since Mt Gox’s rehabilitation plan still needs to be approved by the court, the distribution won’t start immediately. However, the fact that the Mt Gox rehabilitation process enters its final distribution phase may become a bearish signal for the market.
Bottom Line:
Multiple creditors who lost money had to wait for their money for years. Now due to the significant increase in the value of Bitcoin since 2014, no wonder if recipients are tempted to sell them for profit. That could create interim selling pressure. However, do note that even if the court approves the plan, the distribution will not happen immediately.
