Online Voting Window for Mount Gox Civil Rehabilitation Plan Finally Closes

The window has closed for Mt. Gox creditors to vote online on a civil rehabilitation plan to recover losses incurred after Mt. Gox shut down in 2014.

When Mt. Gox exchange shut down in 2014 due to a hacking incident that saw it lose $450M in bitcoin and $27.4M from its bank account, it left creditors in a quandary, having no way to pay them back. A Japanese court gave the go-ahead for a petition for a civil rehabilitation plan, in which creditors could receive a total of $6.8B in Japanese yen, bitcoin, and bitcoin cash if creditors vote in favor of the plan.

Market shock anticipated if creditors vote in favor

In the Mt. Gox hack, 850000 bitcoins were “lost”, of which 200000 have been recovered, which will be used to compensate the creditors, in the event that the majority are in favor. The voting process began on May 31, 2021, online voting ended on Oct 8, 2021, while in-person voting remains open until Oct 20, 2021. On October 20, there will be an announcement from the trustee of the Mt. Gox bankruptcy, on a timeline that will see creditors paid progressively, should the affirmative response to the rehabilitation plan be the majority vote. If the plan is not passed, the former CEO of Mt. Gox and its shareholders will be paid out at the price of bitcoin in 2014, $450, after creditors are paid out.

Crypto-analysts warn of a bitcoin price shock if the civil rehabilitation pays out over $6B, resulting in a mass dump of bitcoins into the market.

No indication from Tokyo court as to voting outcome

At its peak, Mt. Gox was handling 70% of global bitcoin transactions. The company filed for bankruptcy after the infamous hack and left 36800 creditors with no recourse until, amidst a series of delays and legal obstacles, the Tokyo District Court decided to green-light the petition by accepting a draft of the rehabilitation plan in December 2020, and issued an order that would allow claimants to vote on it.

To date, it is not clear how claimants have voted, and a coordinator of the creditors’ group Mt. Gox Legal has said that creditors have asked the Tokyo District Court Representative and the Trustee for an idea as to the outcome of the vote, as the deadline approaches. The coordinator said that, had they known after half of the voting period whether the participation rate was too low, then they could have done something to bring more attention to the issue. The coordinator believes that most people will vote in favor of the rehabilitation plan, since they stand to benefit more than if the company’s bankruptcy filing were ratified.

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The post Online Voting Window for Mount Gox Civil Rehabilitation Plan Finally Closes appeared first on BeInCrypto.

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