The defunct cryptocurrency exchange Mt. Gox is preparing to repay its creditors through the Bitstamp exchange, Cointelegraph reported, citing recent on-chain activities. The cryptocurrency exchange has reportedly executed test transactions that hint at imminent large-scale repayments.
On-chain Transactions
Mt. Gox has been dormant since it collapsed a decade ago, but recent on-chain fund movements indicate that creditor repayments could be approaching. The first test transactions to Bitstamp cold wallets were reportedly flagged by blockchain intelligence firm Arkham Intelligence on July 22.
Amid the anticipation, crypto investors are speculating about the potential downward pressure on Bitcoin's price. This step marks a significant milestone for the 127,000 creditors owed more than $9.4 billion worth of Bitcoin.
As of July 17, more than 36% of the Bitcoin owed to creditors had already been distributed. The address associated with Mt. Gox currently holds over 90,300 Bitcoin, valued at $6.12 billion. While the exact timing of the repayments remains unclear, the recent test transactions on Bitstamp suggest that the final preparations are underway.
In June, the crypto exchange announced plans to start repaying its users. The rehabilitation trustee mentioned that repayments will be processed in Bitcoin and Bitcoin Cash starting this month. The repayments will be made through the selected exchanges, and the order of payment will reportedly depend on the respective exchange.
BREAKING: Mt Gox to start $BTC and $BCH repayments in July. Expect turbulence, especially with Fed week this week too.The Tokyo-based Mt. Gox was hacked in 2011 and went bankrupt in 2014 after it lost 850,000 #BTC. It will repay creditors around $9 billion in #Bitcoin,… pic.twitter.com/VXAzGnLncg
— Ken Standfield (Inventor - CTKS Method) (@StandfieldKen) June 24, 2024
Payments after More than a Decade
According to a note from the exchange, the rehabilitation trustee will start the repayment process for its customers since it lost 850,000 Bitcoins. The firm mentioned that it had completed the exchange and confirmation of the required information with certain cryptocurrency exchanges.
Last year, Mt.Gox’s creditors started receiving compensation for their losses after the crypto exchange collapsed. In a report by Finance Magnates, several Mt. Gox creditors took to social media to confirm receiving payments for their blocked Bitcoin deposits in fiats. Nobuaki Kobayashi, the trustee managing the collapsed exchange’s estate, forwarded emails to the rehabilitation creditors the previous month confirming the commencement of payments.
This article was written by Jared Kirui at www.financemagnates.com.
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