Mt. Gox Creditors Shouldn't Expect Restitution in 2017 Either – Featured Bitcoin News


Mt. Gox Creditors Shouldn't Expect Restitution in 2017 Either

Mt. Gox creditors should not expect payouts in 2017, according to a party close to the pending litigation against the defunct Japanese exchange. Peter Vessenes, who founded Mt. Gox-claimant Coinlab in 2011, claimed as much in a since-deleted Reddit post in which he said he has received death threats for his part in the drama. 

There are dozens of former Mt. Gox customers with claims against the now defunct Bitcoin exchange. Mr. Vessenes, whose Coinlab seeks $75 million from Mt. Gox, says those who have issued the death threats believe his suit is delaying the legal process. He shares a different view.

Also Read: Trustee: Coinlab Delaying Mt. Gox Payouts

100 Assessments Pending, No Payouts In 2017

Mt. Gox Creditors Shouldn't Expect Restitution in 2017

“The latest news I have from our sources in Japan say there are over 100 assessments pending, and that creditors should not expect payouts of any sort in 2017,” according to Mr. Vessenes, whose firm in 2012 was set to become Mt. Gox’s exclusive agent, before the two exchanges sued each other.

Despite various claims Coinlab has delayed Mt. Gox proceedings, Mr. Vessenes contends otherwise. “We are on the same schedule as all creditors with assessments as far as I know,” he wrote in the social media post. 

Mr. Vessenes, who registered Coinlab in Seattle, adds: “From reading the reviews of creditor meetings here I wouldn’t say we’re any more informed than anybody else about the process, but if we do learn information about the bankruptcy that impacts creditors, I would be happy to share it.” In a phone conversation with, Mr. Vessenes made clear he is not privy to more information than other creditors.

The Japanese bankruptcy trustee, however, argues Coinlab’s $75 million lawsuit against Mt. Gox, which predates the Japanese exchange’s collapse, has delayed creditor payouts.

“I’m disappointed to hear that this lawsuit is responsible for holding up payouts, and that any judgement for Coinlab would be treated on par with depositor victims,” Kraken CEO Jesse Powell, whose firm is overseeing creditor claims, told last September. “I think people are having a hard time getting their heads around the $75m+ claim given that common perception is that Coinlab never performed and owes $5m+ back to Mt.Gox. If the deal had been carried out, it might be Coinlab on the hook for the shortfall of client deposits.”

Bitcoin Partnership Gone Awry

Coinlab filed suit against Mt. Gox in June 2013, claiming Mt. Gox breached a contract by not revealing adequate existing client data. Mt. Gox claimed Coinlab had yet to fulfill U.S. licensing and regulatory requirements before it could act as Mt. Gox’s U.S. agent. Amid the increasing price and media attention in 2013, the Department of Homeland security stopped payment processor Dwolla from doing business with Gox. The DHS seized $5 million from a Mt. Gox bank account in 2013, and 2.1 million in August of the same year.

Mt. Gox Creditors Shouldn't Expect Restitution in 2017

Mr. Vessenes, who finds enterprise blockchains more intriguing than Bitcoin these days, claims the contract between Mt. Gox and Coinlab stipulated litigation between the firms would transpire in Washington State courts. Mr. Vessenes says Mt. Gox’s insistence to have the matter heard in Japanese courts have slowed down the process.

“We were almost literally just waiting for oral arguments as far as I remember,” he wrote. “The trustee has consistently resisted efforts to get the case sorted in any venue but the Japanese bankruptcy courts, which I suppose is fair enough from his perspective, and probably better for the estate…it saves the estate money.”

Japanese police continue their investigation of Mt. Gox, which currently holds less than $10.48 million USD and 202,185 BTC in its bankruptcy estate. Some creditors have reported accepted claims against Mt. Gox. The next creditors meeting is in March.

Are you a Mt Gox creditor? Would you prefer to see this saga settled once and for all? Let us know.

Images: Jon Southurst, Twitter

Tags in this story
Bankruptcy, Bitcoin, CoinLab, Mark Karpeles, Mt Gox, Peter Vessenes

Whether you’re a beginner or a long-time bitcoin player, there’s always something interesting going on in the Forums. We are proud free speech advocates, and no matter what your opinion on bitcoin we guarantee you’re seen and heard here. We don’t censor.

Justin Connell

Justin is a writer with the News team.

Show comments