Mt Gox Entered Civil Rehabilitation Procedures And Has To Pay Back Its Former Clients In Bitcoin (BTC) Only
Mt Gox is a closed cryptocurrency exchange platform that was the victim of a massive Bitcoin (BTC) hack in 2014. Now, moving Mt Gox case from a bankruptcy process to civil rehabilitation procedures, the Tokyo District Court forces the defunct crypto exchange operator to pay back its customers in Bitcoin (BTC).
The shift from the bankruptcy process to the civil rehabilitation procedures is affecting Mt Gox significantly because, while still under bankruptcy procedures, the cryptocurrency exchange platform could’ve paid its clients in the Japanese national currency, the Yen. Now, as the Tokyo District Court started the civil rehabilitation process for Mt Gox, the latter has to pay back the people in Bitcoin (BTC).
The difference is that in the first case Mt Gox would’ve had to pay only $483 for every lost BTC (the BTC value in 2014), while in this civil rehabilitation process it has to pay in BTC which is trading at about $6,400.
Mt.Gox forced to pay back its clients in Bitcoin (BTC) – When will the payments commence?
The new procedure is not at all a good one for Mt. Gox, the former cryptocurrency exchange platform, because a simple math calculus shows that the value Mt Gox has to pay back exceeds by far the value of its clients’ lost Bitcoin (BTC). For example, if a client had lost 1,000 BTC on Mt Gox, in 2014, it would mean that client lost about $4,830. Now, Mt Gox has to pay that client with 1,000 BTC, according to the civil rehabilitation process, which, at the trading rate of today, would mean about $6,4 million. Imagine that!
The announcement regarding the civil rehabilitation process of Mt Gox doesn’t stipulate when the defunct cryptocurrency exchange operator will pay back its clients affected by the 2014 Bitcoin (BTC) hack. However, it does state that clients who want to be compensated for their losses must apply for recompensation by October 2018.
Eduard Watson Author
An experienced finance writer for more than 10 years, active industry watcher, and gadget enthusiast.