At least four hedge funds in the United States and Japan have reportedly started buying claims from the more than 24,000 creditors who lost their bitcoins and cash when bitcoin exchange Mt. Gox collapsed in 2014.
In May 2016, court-approved trustee Nobuaki Kobayashi announced that they have verified a total of 24,750 Mt. Gox investors. These creditors are expected to receive more than a quarter of the lost bitcoins and cash in their accounts, which totals to JPY263.52 trillion (USD2.41 million), Kobayashi said at the time.
Now, sources told the Financial Times that the hedge funds have begun buying or offering to buy claims” from the said investors. According to the report, the hedge funds “are offering claimholders a shortcut that lets them sell their claim now and receive 15 percent of the yen value of each claim in cash.”
A website called mygoxclaim.com offers to link verified creditors, particularly those with more than USD10,000 claims in value, with hedge funds potentially interested in buying their claims.
“We serve as an information portal and liaison to help you sell your claim in the MtGox bankruptcy. We’re in touch with third parties who are interested in purchasing claims and can help broker a deal,” MyGoxClaim said in its website.
In mid-2016, Kobayashi said he holds 202,1163.411 bitcoins, which are worth USD92 million at the time. No one knows when the claims will be settled, but the payout is expected to come entirely in the form of bitcoins, which could be a huge advantage for the hedge funds, who are wagering on the future price of the digital currency.
Bitcoin was trading under $450 when the claims were lodged in 2014. A long time has passed since then, and bitcoin has recently broke through the $1,000 barrier for the first time since Mt. Gox collapsed.
Mt. Gox was once the world’s largest bitcoin exchange platform, until it filed for bankruptcy in February 2014, saying it had lost more than 800,000 of its clients’ and own bitcoins, worth more than $450 million at the time.
Authorities found out later on that Mt. Gox owner Mark Karpeles accessed the exchange’s trading system, which was hosted in the United States, and altered the data in his personal account to inflate its total cash value by $1 million. Authorities also believed the Frenchman misused $8.8 million of his clients’ money.
The Mt. Gox controversy has prompted Japanese authorities to push for the regulation of virtual currency business in the country. Financial regulators recently tabled a proposal that will see digital currencies like bitcoins treated as real money. The bills passed the Lower House in April and are currently under deliberation in the Upper House, much to the excitement of bitcoin operators who are keenly waiting for digital currency to be regulated in Japan.
Current bitcoin price
The price of bitcoin is back at $1,000 this week, trading at just above $1,007 early Monday morning.