Defunct Mt. Gox Still Impacts The Crypto-Market

A trustee of the now-defunct cryptocurrency exchange Mt. Gox has come up with the details of the firm’s settlement process. In a September 25th post, attorney Nobuaki Kobayashi disclosed on the Mt. Gox website that the firm had already exchanged over $230M USD worth of cryptocurrencies. Kobayashi pointed out that the cryptocurrencies sold for fiat currencies were Bitcoin (BTC) and Bitcoin Cash (BCH). The attorney noted that the transactions took place between March 18th and June 22nd, 2018.

Sales Specifics

In the notice, the trustee gave a breakdown of the sales. He noted that they sold 25,331.00761 BCH and 24,658.00762 BTC, amounting to 25,975,702,352 JYP ($230,269,821.82 USD). Speaking further, Kobayashi disclosed that the sales increased the amount in the firm’s account to 70,059M JYP or approx. $621M USD.

In more revelations, the trustee said that they have set up a trust to manage the funds in fiat currency for Mt. Gox creditors.

Kobayashi explained that the decision to preserve the cryptocurrency in fiat currency was “necessary and appropriate” as a way of raising funds needed to secure the creditors’ interests. He said that by doing so, they now have enough funds for offsetting the creditors’ principal amounts and delay demands of all the bankruptcy claims.

Mt. Gox Creditors Make Different Refund Requests

Kobayashi noted that even though many creditors want their investments returned in fiat currency from what is left of the exchange, many others want them in a digital currency. The attorney explained why the latter group needs their investments in virtual currency was that the price of cryptocurrency has increased since the exchange was shut down in 2014.

While Mt. Gox continues to seek ways to settle with its creditors amicably, crypto-asset investors are, however, unhappy with the now-defunct exchange’s decision to sell off their cryptocurrency. Indeed, they blame the exchange for flooding the market with excess digital currency, thereby causing the year’s worst market bears.

Sales Report

In March 2018, CoinDesk reported that Mt. Gox sold BTC and BCH totaling $400M USD a month before. Even as the sales were on at the time, Kobayashi noted that the sales were made in such a way that it didn’t affect the cryptocurrency market. However, based on the criticisms from the stakeholders, the crypto-asset investors still raked the exchange over the coals for the bearish market performance ever since the exercise kicked off in 2018.

Background Information

Launched in July 2013, Mt. Gox was a BTC exchange based in Tokyo, Japan. The exchange at some point handled over 70% of global BTC transactions, making it the biggest BTC intermediary and leading BTC exchange. When it suffered a massive cyber attack, the exchange folded up and finally, filed for bankruptcy.

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