Mt. Gox, one of the biggest bitcoin exchanges and the most popular theft victim is yet again in the news as its former CEO Mark Karpeles talks about his role in the fiasco and leading the now bankrupt company through civil rehabilitation.
Mark Karpeles, Mt. Gox former CEO posts his heart out
It’s the never-ending Mt. Gox Saga, yet again! The former CEO of Mt. Gox, Mark Karpeles came forward and posted on Reddit about the whole debacle with a “Ask me anything you like”.
Mt. Gox, which was one of the biggest bitcoin exchanges that accounted for world’s 70 percent bitcoin transactions went bankrupt after the alleged bitcoin theft in 2014 that led to a decline of 36 percent in the bitcoin prices. The same Mt. Gox had also been responsible for drops in bitcoin prices from December 2017 to February 2018.
Mark Karpeles basically bought the site from Jed McCaleb in 2011 and became the CEO of the exchange. In February 2014, Karpeles resigned from his position just before the company announced the loss of bitcoins.
Karpeles talks about the events in detail, starting with filing for civil rehabilitation on February 28, 2014, whose four months after the exchange became bankrupt. According to him, his efforts to help Mt. Gox out of trouble wasn’t enough for which he had been arrested and now assisting in the civil rehabilitation of Mt. Gox.
He further clarifies:
“Japanese bankruptcy law has a particularly nasty outcome here, and I want to address this up front. As creditors claims were registered, those claims were registered in the valuation of Japanese Yen on the bankruptcy date…This means that the claims can be paid back in full, and there will still be over 160,000 bitcoin and bitcoin cash in assets in the Gox estate… those assets are distributed to shareholders as part of the liquidation.”
As for himself, Karpeles doesn’t want these billion dollars as “From day one I never expected to receive anything from this bankruptcy.”
Is civil rehabilitation answer to Mt. Gox mess?
He believes civil rehabilitation is the way in which he is dedicatedly working on:
“The fact that today this is a possibility is an aberration and I believe it is my responsibility to make sure it doesn’t happen. One of the ways to do this would be civil rehabilitation, and as it seems most creditors agree with this, I am doing my best to help make it happen.”
So, now you must be wondering, it’s so simple, we’ll get our bitcoins back, apparently not:
“Payments to shareholders in Bitcoin are unheard of, and are probably not an option since taxes on payments to shareholders have to be calculated, which means whatever is being paid need to have a stable value in JPY.”
If the exchange doesn’t go to civil rehabilitation, the remaining 165,000 of each bitcoin and bitcoin cash will be sold by the Mt. Gox trustee which would only lead to the market crash as it did last time.
Mt. Gox had about 1 million bitcoins in its trust out of which around 800,000 were claimed to be stolen. The remaining 200,000 bitcoins were then valued at bankruptcy price i.e. approximately $400. Recently, the trustee sold some 35,000 of BTC and BCH each and about 165,000 bitcoins and $100 million worth of BCH are still left.
The court says everyone is paid back but then who will be getting the remaining billions worth of bitcoins. Well, by bankruptcy law Karpeles would be that person. An individual who was the in charge of the exchange when all went down, literally!
However, Karpeles in his trial in June 2017 claimed to be innocent and further mentioned that the business was having problems with debt portfolio management that could lead to its bankruptcy.
With the bankruptcy already been going for over 4 years, it’s time that the court takes the right decision and hand over the coins to their rightful owners. It has been extended for far too long that only ends up hurting the sentiments of investors and market.
Are you convinced that Mt. Gox who still has large amounts of bitcoin funds would not repeat the same mistake again??
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I am an associate content producer for the news section of Coingape. I have previously worked as a freelancer for numerous sites and have covered a dynamic range of topics from sports, finance to economics and politics.