Fortress Investment Group has reportedly agreed to payout creditor claims of defunct Bitcoin Exchange Mt.Gox after years of court proceedings. The said bailout would be less than what these creditors can claim under a trustee-backed proposal set for a vote in October. However, due to continued delays and backouts by trustees, creditors are left with not much of an option.
The rehabilitation plan for creditors is set for an October vote and once passed the Fortress investment group would offer creditors 90% of their claims which could take another 2 years time. However, the current bail-out would see creditors receive 80% of their claims.
Creditors would get the full amount owed them in cash, Bitcoin or Bitcoin Cash https://t.co/OcF6q7v20A
— Bloomberg Crypto (@crypto) March 19, 2021
Michael Hourigan, managing director at Fortress believe that many creditors have waited for almost 7-8 years and waiting for another 1-1.5 years won’t be possible for them and seeing that they have decided to offer an early bailout plan where the company themselves would provide the refund in cash or Bitcoin. He said,
“Rather than waiting for another 1 to 1.5 years, we are offering a liquidity option for creditors who want to receive cash or BTC now,”
The Never-Ending Mt. Gox Saga
Mt. Gox at its time was one of the largest bitcoin exchanges processing over 80% of the circulation supply during its peak operational days. However, the exchange came to a screeching halt when the team behind the operations lost a significant chunk of Bitcoin holdings and deemed it a hack. However, early investigations suggested that the exchange lost the Bitcoin some of which were found later. What followed was months of court battle many of which still going on.
The worst affected due to the Mt. Gox going defunct were the traders and creditors who have been fighting a long-drawn court battle despite a refurbishment plan being finalized years ago. On most occasions, the cause of the delay is due to the settlement amount where the trustees want to pay less while creditors want the most of their lost investment.
