We have received multiple reports that victims of the defunct Bitcoin exchange Mt. Gox are finally receiving their funds back after a long and complicated legal process that started in 2014.
Reddit and Telegram users confirmed they received some of their Japanese Yen-denominated payments via PayPal.
It is important to note that these are just initial cash payments, and the $6 billion worth of Bitcoin that has been locked for a decade will likely begin distribution soon. Originally, Mt. Gox was supposed to release its 140,000 BTC in October of this year.
Read: Two Russian Nationals Indicted In $400 Million Mt. Gox Bitcoin Hack Case
Repayments Plan Context
The Tokyo District Court approved a rehabilitation plan in October 2021 that will distribute a mix of cryptocurrencies and fiat money to the creditors who lost about 750,000 BTC (worth $450 million at the time), in a hack that brought down the exchange.
The plan became final in November 2021, and was supported by 99% of the creditors. According to the plan, creditors will receive 71% crypto and 29% cash in repayments.
The crypto assets include 141,686 BTC, 142,846 BCH, and some other forked coins. The fiat assets include ¥69.7B and some other currencies.
The trustee, Nobuaki Kobayashi, who was appointed to oversee the liquidation and distribution of the exchange’s assets, set up an online rehabilitation claim filing system, where creditors can register and select their preferred repayment method.
Creditors had the option of a lump sum payment, bank remittance, fund transfer service provider or going through a crypto exchange or custodian. The deadline for registration and selection was March 10th, 2023.
Read: 7 Things to Consider When Choosing a Crypto Exchange
Mt. Gox Background
Mt. Gox was once the world’s largest Bitcoin exchange since its demise in 2014. It was founded years before it became a Bitcoin exchange, as a fantasy trading card game service called Magic: The Gathering Online eXchange (the acronym of Mt. Gox).
So, the exchange was originally designed for like Orcs, Goblins and Elves — it was never really meant to hold millions of dollars.
And eventually overtime, this first major Bitcoin exchange was used by many as a very convenient way to buy Bitcoin. Because back in the day, it was not easy to buy BTC — you had to actually at times try and connect a buyer to a teller one-on-one.
Notably, the exchange was also centralized and the users’ data were all in one place. In 2014, there was a massive hack where 750,000 Bitcoins vanished in users’ accounts, and the price of Bitcoin cratered — it seemed like a crisis that Bitcoin could never recover from at that time.
The wild thing is though, the owner of the exchange happened to find a paper wallet for 200,000 Bitcoins that he thought was stolen. So these creditors had a claim on these Bitcoins they have been trying to get back the last decade, and they are now on the verge of getting some of that back.
Read: Crypto Terror: 5 Biggest Cryptocurrency Heists in History
Final Thoughts
The creditors squeezed out their anticipation and excitement for receiving their funds after almost ten years of waiting. While not a hundred percent restoration, this Christmas marked a closing chapter in the Mt. Gox saga, giving creditors the long-awaited relief and hope after a decade of distress.