Biggest Crypto Heist Mt Gox Plans To Return Loss Funds to Creditors

There's a huge chance that Mt Gox creditors will get back the lost investments they put into the exchange five years ago before the company was hacked.

Biggest Crypto Heist Mt Gox Plans To Return Loss Funds to Creditors

Brock Pierce had recently called for a Civil Rehabilitation Plan, which is a legal process that will help bring back whatever debts Mt Gox owed to its creditors.

 

Bitcoin exchange based in Japan Mt Gox used to be the world's largest digital money exchange, but in 2014 it became a victim of a massive hack which resulted in 740,000 bitcoins of loss. During that time, Mt Gox accounted for about 6% of the world's Bitcoins. What's more is that this amounted to €460 million at that time.

 

Aside from the hacking of the company's e-wallet, Mt Gox also lost $27 million from its bank account. Eventually, the team did recover 200,000 bitcoins, but there were still 650,000 bitcoins that are missing up to this day.

 

Five years after the disaster, Pierce, who is the only shareholder of Mt Gox, comes out of the dark introducing to us a brand new project called Gox Rising, which will inevitably help revive Mt Gox.

 

Most importantly, Gox Rising ensures the victims that they will get a fair share of what they have lost during the  "big heist."

 

Pierce had been planning to buy Mt Gox in 2014, but swiftly changed his mind. However, as he was speaking at a conference, Pierce found out how Mt Gox was currently under the waters.

 

This was when he contacted Mark Karpeles, who was the previous owner of Mt Gox, quoting 1 Bitcoin to purchase 88% of the company's stakes.

 

Pierce requested that his contract with Karpeles not to be published, but it was stated in the agreement that Karpeles had sold all the assets of Mt Gox to Pierce. He, later on, denied this saying that he had asked Pierce to invalidate the contract. However, Pierce said that he pushed through with it anyway.

 

Mt Gox at that time was set for rehabilitation that the creditors did not want, but recently a new proposal had been sent by the Japanese government stating its acceptance of the proposed rehab.

 

Pierce knew that taking Mt Gox would be a financial risk, but during his acquisition of the company, Pierce was involved in some Bitcoin and Ripple projects, which were both booming at the time.

 

During an interview with CCN, Pierce said that he is already well-positioned and wrongly entitled to the assets of Mt Gox.

 

When the big heist hit Mt Gox, only 200,000 Bitcoin was recovered all to the dismay of the company's creditors. Luckily, the amount has significantly appreciated by now since the time of Mt Gox's demise.

 

When Pierce bought Mt Gox, it did not only acquire 100% of its assets but the problems as well. His lawyers were freaked out about the issues involved with the company and decided to throw it into bankruptcy.

 

Pierce had appeared in front of the legal court to convince the Japanese government not to liquidate Mt Gox. As a final decision, the Japanese government decided to allow Mt Gox to proceed with its operations through the rehabilitation. In return, the debt owed to the creditors would be reimbursed to its respective owners.

 

While the Civil Rehabilitation Plan sounded like an excellent idea, it was also important to note that Mt Gox was the first-ever crypto hack case the Japanese government ever had to deal with. So, Pierce decided to give himself some time to become educated with the issue at hand before proceeding.

 

Not only did the hearing bring birth to the rehab plan for Mt Gox, but at the same time, it also resulted in up to 10 years of jail time for Karpeles.

 

Pierce stated that most of the Mt Gox funds in his hands right now will go straight to the creditors, but he doesn't mind because he is more concerned about clearing the bad history of Mt Gox and moving on to a new start, indicating that the company will be having a comeback.

 

"We have the rise, the fall, and it’s been in liquidation and bankruptcy in Japan for over five years. But the story is not over. The last chapter of this book is unwritten. We have the power to write that story. What kind of ending do we want for that story? For what is our Bear Stearns, for what is our Lehman Brothers, for what is our Enron? Are we different than the traditional financial system?" Pierce said.

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