BITCOIN

How bitcoin’s price surge may signal a reversal of fortune for Mt. Gox

TAGs: Bitcoin, Japan, mt. gox

One embattled bitcoin exchange is poised to reap the benefits of bitcoin’s recent advance towards record territory.

How bitcoin’s price surge may signal a reversal of fortune for Mt. GoxMt. Gox was once the world’s largest bitcoin exchange platform, until it filed for bankruptcy in February 2014 after it claimed to have lost more than 800,000 of its clients’ and own bitcoins, which are worth more than $450 million at the time.

Court-appointed trustee Nobuaki Kobayashi previously said he holds a stash of bitcoins that are valuable now to pay off Mt. Gox’s creditors, thanks to the digital currency’s latest price surge. On Wednesday afternoon, bitcoin traded at $2,758.03 per coin on the Bitcoin.com platform, which means that the 202,185 bitcoins that Kobayashi has in his care are now worth more than $557 million.

Of course, Mt. Gox’s solution to insolvency hasn’t escaped the notice of its creditors, many of whom have called on former CEO Mark Karpeles and Kobayashi to shed light on the matter.

“This is crazy. We have an opportunity here to make everyone happy… Why is it being ignored? We need Kobayashi to respond, Mark Karpeles has already lost all integrity,” stated on commenter on Reddit.

Meanwhile, commodities trading firm DRW has offered to help convert all of Mt. Gox’s 202,185 bitcoins to U.S. dollar or Japanese yen.

“Cumberland Mining would like to announce our willingness to convert all of the 202k BTC held in the Mt. Gox bankruptcy process to USD or JPY. We have a track record of providing liquidity for large bitcoin trades, including several government auctions. As one of the world’s largest OTC bitcoin trading desks, we’re in a unique position to help,” DRW subsidiary Cumberland Mining posted on Reddit.

Cumberland Mining’s head of trading Mike Komaransky confirmed the offer on Twitter, where he said: “Now that you’re solvent again, @MtGox @MagicalTux, we @Cumberland_BTC can help convert your 202k bitcoin to fiat.”

There’s just one issue: the creditors want to be paid in bitcoin, not fiat currency.

One Reddit user posted that “everybody want to help in order to take our BTC,” while another user wrote, “Thanks. But I’d rather prefer to get paid in BTC. No need to convert.”

Cumberland Mining isn’t the first firm to propose a workaround for Mt. Gox claims. In February, a website called mygoxclaim.com started offering to link verified creditors, particularly those with more than USD10,000 claims in value, with hedge funds potentially interested in buying their claims.

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