Yesterday, some people who lost bitcoin when the infamous exchange Mt. Gox shuttered in 2014 say they received an interesting email. Sent via an address from the Japanese law firm working on Mt. Gox’s bankruptcy case, the email indicates that receivers may finally be getting some of their lost bitcoin back.
For those who weren’t tuned in during bitcoin’s earlier days, Mt. Gox was a major bitcoin exchange purchased by Mark Karpelès in 2011. Long story short, the exchange closed in February 2014, filed for bankruptcy, and reported that it had been hacked, losing 850,000 bitcoin (some of which were eventually recovered).
One person posted the letter they received yesterday from Mt. Gox’s bankruptcy trustee on Imgur and Reddit. Written in both Japanese and English and addressed to “each of MtGox user [sic],” it noted that on April 19, 2019, “the creditors who objected to your self-approved rehabilitation claim withdrew their objections.” To put it simply, this means claims brought on behalf of the email’s receivers will move forward.
Get the BREAKERMAG newsletter, a twice-weekly roundup of blockchain business and culture.
There’s no indication of when these former Mt. Gox users can expect to receive compensation for their 2014 bitcoin losses, or whether they’ll get them in BTC, U.S. dollars, or Japanese yen. Neither Mt. Gox’s remaining support team or the law firm dealing with its bankruptcy, Nagashima Ohno & Tsunematsu, immediately responded to our request for comment.
The person who posted their Mt. Gox letter on Reddit, who preferred we call them by their Reddit handle, DerEwige, explained to us, “The lawyer handling the bankruptcy of Mt. Gox made automated claims for all users that were a) verified (KYC) [and] b) had funds on Mt. Gox at the time of shutdown.” DerEwige only had 0.01 BTC on Mt. Gox when it closed (then worth less than $10), and they’d only started using the exchange about a month or so before then. “What percent of [that 0.01 BTC] I might receive…I have no clue,” they wrote to us.
DerEwige’s claim was automated because they never submitted one to get back their lost funds (“It’s not very much,” they wrote). Over the years, DerEwige was given multiple opportunities to file such a claim, which they repeatedly declined. Then, three months ago, DerEwige got a note announcing automated claims for everyone holding bitcoin on Mt. Gox during its collapse.
Other former Mt. Gox users opposed this action. When DerEwige was notified of this, they decided to reinforce their claim. The letter DerEwige got yesterday showed that objectors took back their protests, meaning DerEwige’s and others’ automated claims will go through without any further action needed on the behalf of the claimants. (Again, when and how this will happen remains uncertain.)
Mt. Gox’s bankruptcy trustee is Nobuaki Kobayashi, who entered into that role in April 2014. Between September 2017 and March 2018, Kobayashi sold $400 million worth of Mt. Gox’s bitcoin funds as part of an ongoing effort to pay back people owed money from the exchange. Because Kobayashi sold about half that amount on February 5, some bitcoin investors blamed him for the bitcoin price dip (to $6,000) that followed the next day. Some even accused him of trying to crash bitcoin.
Since yesterday’s letter concerned automated claims, it’s likely that many receivers were like DerEwige—people who didn’t lose enough in Mt. Gox’s shutdown to bother making much of an effort to get their bitcoin back. Meanwhile, an ongoing, $16 billion legal dispute with Coinlab, which partnered with Mt. Gox in 2012 to become the exchange’s U.S. limb, will likely continue to put any reimbursement date for former Mt. Gox users on hold.