Mt. Gox Creditors Choose to Collect Claims in Bitcoin

02/17/2023 19:59 • AI Insights • 82 views

According to reports, according to people familiar with the matter, the two largest creditors of Mt. Gox, a crypto exchange that collapsed nine years ago due to hacker attacks, have chosen to collect their claims mainly in Bitcoin (BTC). Bitcoinica and MtGox Investment Funds (MGIF), the cryptocurrency exchange headquartered in New Zealand, together account for about one fifth of the total claims of Mt. Gox, and will receive 90% of the recoverable funds. This decision may alleviate the long-term concern of Bitcoin holders that the liquidation related to the bankruptcy claim of Mt. Gox may put pressure on the price of Bitcoin, because if these two creditors choose to pay in legal currency, the trustee supervising the bankruptcy property may be forced to sell most of Bitcoin recovered by Mt. Gox to meet the payment requirements in legal currency.

Sources: The two largest creditors of Mt.Gox choose to collect their claims mainly in Bitcoin

Analysis based on this information:

Reports show that the two largest creditors of Mt. Gox, a crypto exchange that collapsed in 2014 due to hacker attacks, have decided to collect their claims mainly in Bitcoin. Bitcoinica and MtGox Investment Funds (MGIF), both of which are cryptocurrency exchanges, are expected to receive 90% of the recoverable funds. This decision may help ease concerns from Bitcoin holders that the liquidation related to the bankruptcy claim of Mt. Gox could negatively impact the Bitcoin price.

Mt. Gox was once the largest Bitcoin exchange in the world, but it declared bankruptcy in 2014 after losing around 850,000 Bitcoins to hackers. The exchange promised to return the lost Bitcoins to their customers, but the bankruptcy trustee had to sell some recovered Bitcoins to compensate for the losses. This sale led to a significant decline in the price of Bitcoin at the time.

Since then, a rehabilitation process has taken place under the supervision of the Japanese court, as the exchange was based in Tokyo. One of the major steps in this process involves recovering the remaining assets of the exchange and distributing them among the claimants.

Given the significant amount of money involved, the decision of the two major creditors to collect their claims in Bitcoin is a positive sign for the crypto industry. Had they chosen to receive their payments in legal currency, the trustee would have had to sell most of the recovered Bitcoins to meet the payment requirements. This would have increased the selling pressure on Bitcoin and could have negatively impacted its price.

Moreover, the decision to collect their claims in Bitcoin indicates that the creditors remain bullish on the cryptocurrency’s future prospects. This may spark confidence in Bitcoin holders, who have seen the digital asset surge in popularity over the past few months.

In conclusion, the choice of Bitcoinica and MGIF to collect their claims in Bitcoin may have a positive impact on the future prospects of the cryptocurrency. It could also potentially alleviate the potential selling pressure on the crypto market, which could have arisen had the recoverable funds been paid in legal currency.

Overall, this decision reveals underlying optimism in the future of Bitcoin among creditors and could serve as a boost to the crypto industry.

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Mt. Gox Creditors Choose to Collect Claims in Bitcoin

Sources: The two largest creditors of Mt.Gox choose to collect their claims mainly in Bitcoin

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