A group of creditors of the defunct bitcoin exchange Mt. Gox have already started preparing a rehabilitation plan to claim for bitcoin repayments following a court’s decision in June.
Lawyers representing several Mt. Gox creditors – who filed a petition in November to move Mt. Gox out of bankruptcy and into a process of civil rehabilitation – on Thursday published an updated proposal for preparing the rehabilitation plan.
The lawyers released an initial basic policy for the plan on June 29, just one week after a court in Tokyo approved creditors’ civil rehabilitation petition from late last year.
The policy stated in June that it would be “appropriate” to repay creditors who deposited BTC and BCH with Mt. Gox in BTC and BCH instead of cash.
In the latest update, the lawyers further asserted that it will be desirable that these “BTC and BCH be sent to exchanges in which many creditors have accounts or can open accounts easily,” adding:
“We are of the opinion that most of the assets, including approximately 166,000 BTC and 168,000 of BCH and other derivatives currently held by Mt. Gox, should be paid to creditors at the time of the first payment.”
And those assets could be worth over $1.3 billion, based on latest data from CoinDesk’s price index.
The revised policy stated that the first payment to creditors is expected to start in May or June in 2019, if a rehablitation plan can be approved.
Currently, the lawyers representing the group of creditors are seeking further comments before a formal rehabilitation plan can be finalized and presented to the court by February of next year.
In addition, the revised proposal stated that cryptocurrencies other than BTC and BCH held by Mt. Gox should be liquidated into cash and paid to creditors since their prices could fluctuate significantly with security risks.
Mt Gox, once the world’s largest bitcoin exchange by trading volume, declared bankruptcy in 2014 after over 744,000 BTC were stolen. Subsequently, creditors went into a years-long process in a bid to claim for repayments.
Yet, amid bitcoin’s spiking price towards $20,000 late last year, a group of creditors filed a petition to the bankruptcy court in Tokyo to move the case into a process of civil rehabilitation.
At that time, Mt. Gox’s trustee was holding 202,195 bitcoins and then liquidated over 30,000 of them into cash in March 2018.
The court’s approval of the civil rehabilitation petition means that Mt. Gox will no longer need to liquidate any BTC or BCH assets.
Nobuaki Kobayashi, the rehabilitation trustee for Mt. Gox, said in July that a new system for creditors filing proofs for claiming repayments is expected to be released in August.
Japanese yen and bitcoin image via Shutterstock
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