Mt Gox ex-CEO protests billion dollar payout
Mark Karpeles, the primary shareholder of the bankrupt exchange may receive over 160,000 bitcoin.
Former chief executive of ruined cryptocurrency exchange Mt. Gox, Mark Karpeles, admitted that he stands to benefit enormously as a result of Japan’s bankruptcy laws, according to a recent apology post on social media.
In a post on Reddit, Karpeles said that the shareholders of Mt. Gox would walk away with over 160,000 bitcoin.
Japanese bankruptcy law has a particularly nasty outcome here, and I want to address this up front. As creditors claims were registered, those claims were registered in the valuation of Japanese Yen on the bankruptcy date. That’s the only way Japanese bankruptcy law can work (most bankruptcy laws around the world operate this way for that matter).
This means that the claims can be paid back in full, and there will still be over 160,000 bitcoin and bitcoin cash in assets in the Gox estate. The way bankruptcy law works is that if there are any assets remaining after the creditors have been paid in full, then those assets are distributed to shareholders as part of liquidation.
Mark Karpeles explaining Mt. Gox bankruptcy situation on Reddit
The former CEO stands to receive US$1.1 billion in bitcoin, based on current market prices.
“I don’t want this. I don’t want this billion dollars… I do not want to become instantly rich. I do not ask for forgiveness. I just want to see this end as soon as possible with everyone receiving their share,” he said.
Karpeles claimed that he never expected to receive anything from the bankruptcy and labelled the outcome an “aberration”, stating that it is his responsibility to ensure that this sizeable remuneration “doesn’t happen”.
“One of the ways to do this would be civil rehabilitation, and as it seems most creditors agree with this, I am doing my best to help make it happen,” he said. Civil rehabilitation is a bankruptcy law in Japan allowing a company to force a lender to change the terms of a loan in order to alleviate the company’s bad debt.
When asked whether there were any other shareholders that might have a claim to the funds, Karpeles pointed to Jed McCaleb, who owns a 12% share. However, Karpeles doubts McCaleb would want to claim anything.
Formerly bitcoin’s largest exchange, Mt. Gox suspended trading and filed for bankruptcy in 2014. The exchange was based in Tokyo and therefore is subject to local bankruptcy and insolvency rules and regulations.
Yahoo Japan will reportedly purchase a 40% stake in BitARG Exchange Tokyo this month, via a subsidiary, in order to take advantage of the company’s technology and construct its own cryptocurrency exchange.
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