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Mt Gox Repayments Delayed Again
Creditors have been waiting over nine years to get any money back. The new "deadline" is October 2024.
Administrators for the defunct Mt Gox have again delayed the repayment date for customers who lost money when the exchange collapsed in February 2014. In a press release published earlier today, the trustees stated that payments would now be completed by October 31, 2024.
Ten Years In The Making
Mt Gox, the world's first major Bitcoin exchange, was once responsible for around 90% of total BTC trading volumes. Following a series of hacks and long-term mismanagement, customers experienced long delays when making fiat withdrawals. Gox halted BTC withdrawals early in 2014, and shortly afterwards went offline. It transpired that the exchange had been trading insolvent for months.
A total of 850,000 BTC belonging to customers were lost, though 200,000 BTC were later discovered in an "old format" wallet. These 200,000 BTC, now worth a total of $5.4 billion, are the funds with which customers will eventually repaid.
Repayments were supposed to be made by the end of October this year. However, the complex nature of the process means a further delay of some months, and up to a year, will be necessary to complete all payments.
A Mixed Blessing?
The Mt Gox bankruptcy and repayment process has been the subject of much speculation and anxiety within the crypto space. Although customers who lost funds when the exchange closed down will only receive around 20% of the amount in BTC terms, those coins are now worth around 50x more than they were in February 2014, meaning they will still receive ten times the fiat-equivalent amount.
The fear is that many recipients will dump their coins on the market, depressing prices. Realistically, however, this is unlikely. Customers will be repaid slowly, and will not market sell the entirety of their coins in one go. In any case, even at the current low volumes, there is more than enough liquidity to absorb these sells over a period of time.
Nonetheless, the additional delay pushes that event out further, giving crypto traders reassurance that a huge tranche of coins is not about to hit the market.
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