Mt. Gox Trustee Reportedly Sold $230 Million Of Bitcoin And Bitcoin Cash Since March 2018
A new report on the famous Mt. Gox website, formerly the most popular Bitcoin exchange in the world prior to being hacked, reveals that the trustee has sold around 25,000 Bitcoin and Bitcoin cash for total proceeds around $230 million since March 2018.
A notice published on the website of the now-defunct cryptocurrency exchange Mt. Gox stated that one of its trustees has sold $230 million worth of Bitcoin and Bitcoin Cash during the last six months.
Trustee liquidates Mt. Gox assets to repay creditors
On September 26, attorney Nobuaki Kobayashi of the dead cryptocurrency exchange explained in a report on Mt. Gox’s official website the details of the liquidation process.
The posted notice explains that a trustee of the cryptocurrency exchange has been selling cryptocurrencies as part of a rehabilitation process for the company.
According to notice, the trustee of the exchange sold:
- 24,658.00762 BTC (average price of $8,094.38/BTC)
- 25,331.00761 BCH (average price of $1,192.57/BCH)
- Total funds collected ~$229,800,240 USD
According to Kobayashi, prior to the sale, the balance in the trustee account was approximately $621 million. The sales took place between March 18 and June 22 when the cryptocurrency exchange embarked on a civil rehabilitation process.
Prior to this round of sale, the trustee reportedly raised an estimated $400 million from the sale of Bitcoin and Bitcoin Cash, with the sales reportedly being carried out before March of this year by a Mt. Gox trustee.
Large volume transactions such as these have a tendency to affect the prices of the cryptocurrencies involved, however, Kobayashi promised that the process used in selling the assets was structured in a way as to avoid devaluing the coins.
While Kobayashi argues that the sales were done in a way to minimally impact the cryptocurrency market, some pundits have argued that the Gox trustee sales shoulder part of the blame for the longstanding bear market.
The Mt. Gox hack
Four years ago, Japan-based Mt. Gox suffered one of the largest cyber-attacks in cryptocurrency exchange history, leading to the loss of 850,000 Bitcoins.
At the time of the attack, the value of Bitcoin lost was equal to about USD 500 million. Today, that same Bitcoin would be worth over $5 billion, given the current value of Bitcoin.
Following the hack, Mt. Gox filed for protection from creditors. The firm later announced that it had recovered about 200,000 Bitcoins.
Since then, the cryptocurrency exchange has been offloading cryptocurrencies in a bid to solve its bankruptcy problem and revive the exchange.
Mt. Gox revival
In the notice, attorney Nobuaki Kobayashi explained that the funds raised from the sale were used to set up a trust. He further stated that the funds will be kept in fiat for victims of the hack.
In explaining the need for the civil rehabilitation, Kobayashi wrote that it was
“necessary and appropriate to procure a suitable amount of money to secure the interests [of] the creditors for the principal amount and delay damages of the determined and undetermined bankruptcy claims”
While some victims of the hack on the exchange applied for refunds in fiat, some others have requested that their refunds be made using their cryptocurrency holdings before the exchange was hacked.
Given the hikes in the value of Bitcoin and Bitcoin Cash over the last four years, it would be difficult for Mt. Gox to fully reimburse its creditors with the exact amount of cryptocurrencies they lost during the hack.