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- Creditors expected to receive approximately 141,686 Bitcoin (BTC) and 69 billion yen in Mt. Gox plan to pay debts.
- Mt. Gox Investment Funds and Bitcoinica, chose to receive their repayment in Bitcoin.
The infamous rehabilitation trustee of the Mt. Gox cryptocurrency exchange has made headlines with its decision to start repaying its creditors in Bitcoin as part of their rehabilitation plan. The trustee of the exchange is set to refund the creditors by October 31st, 2023.
Nobuaki Kobayashi released a letter on the 7th of April 2023 that covers the repayment plan information. The report surfaced claiming that Mt. Gox is set to release another 141,686 BTC and 143,000 BCH, leading some to speculate that this could cause a significant drop in Bitcoin’s price.
The report also added that 6th April 2023 was the deadline creditors were expected to file their repayment information. In it, Kobayashi also states that the rehabilitation is currently coming up with plans for repayment. For instance, some of the plans among others, include contacting cryptocurrency exchanges, banks, custodians, and money transfer providers.
The early lump sum is expected to start on 31st October 2023. However, the exact repayment dates for individual redevelopment creditors are not yet confirmed. The repayment period may be extended if the Tokyo District Court approves it.
My Gox has selected four crypto exchanges and Luxembourg-based crypto exchange Bitstamp is one among the four. In recent weeks Bitstamp has released a guide showing creditors what they should do to place their claims.
Will the Repayment Affect BTC Price?
Mt. Gox was once one of the world’s largest Bitcoin exchanges before it filed for bankruptcy in 2014. Since then, creditors have been fighting for years to recover their funds, with a civil rehabilitation plan finally being approved in 2018.
The report suggests that Mt. Gox’s decision to release such a large amount of BTC and BCH could have a significant impact on the market. The market may see a sudden drop in Bitcoin’s price as supply increases, leading to a sell-off by investors.
Creditors are expected to receive 143,000 Bitcoin Cash (BCH) approximately 141,686 Bitcoin (BTC), and 69 billion yen. The creditors could choose whether to receive the repayments in Crypto or Fiat. The first 200,000 Yen of each creditor’s claim which is about $1,520 will be paid in Yen. If the claim is higher, creditors can choose to receive in either cash or Crypto. They can receive 71% in crypto and 29% after they get the first repayment.
According to the above repayment plans, the exact amount of Bitcoin to be released to the market is uncertain, but it’s clear that the trustee will not be releasing all the Bitcoin at once. The two biggest creditors; Mt. Gox Investment Funds and Bitcoinica, chose to receive their repayment in Bitcoin. According to a report by Blomberg, the My. Gox Investment Fund will not sell its BTC.
Despite these conflicting opinions, one thing is clear: the impact of Mt. Gox’s repayments on Bitcoin price remains uncertain. While some predict a significant drop, others believe that the market may see a more positive response. Ultimately, only time will tell how Mt. Gox’s actions will impact the value of Bitcoin and the wider cryptocurrency market.
