[2017-11-20] Mark Karpeles Will End Up Taking $859 Million From Mt. Gox Bankrupt

[cybersofts]

Mark Karpeles Will End Up Taking $859 Million From Mt. Gox Bankruptcy

In 2014, Mt. Gox, once the largest bitcoin exchange in the world, filed for bankruptcy. At the time, Japanese creditors requested Mt. Gox to return the equivalent amount of their funds stored in bitcoin in Japanese yen. Since then, the price of bitcoin has risen by 70-fold, and former Mt. Gox CEO Mark Karpeles is expected to take the majority of the profit from the bankruptcy proceedings.

In July, Karpeles attended a court hearing and pleaded not guilty to charges on money laundering and embezzlement, for his involvement in the loss of approximately one million bitcoins, which were worth $400 million during the period wherein the Mt. Gox bankruptcy was filed.

Over the past three years, from 2014 to 2017, the price of bitcoin has increased exponentially, from around $400 to $7,000, by 17-fold. During the investigation into the Mt. Gox bankruptcy from 2014 to 2016, 200,000 bitcoins were recovered and with that, Karpeles was requested to proceed accrediting creditors of Mt. Gox with the recovered bitcoins.

However, after a strange turn of events, it turns out that creditors of Mt. Gox, or former bitcoin traders on the Mt. Gox exchange, are set to be credited with Japanese yen equivalent to the value of bitcoin in 2014.

Paul Wasensteiner, a Mt. Gox creditor, told CCN that creditors were not made aware that their claims were limited to a maximum value of $480 and that the bankruptcy would settle the proceedings based on the price of bitcoin three years ago. Creditors have expressed their concerns over the process of the Mt. Gox bankruptcy, and the possibility that Karpeles, who is directly responsible for the loss of $7 billion in funds, might take away $859 million from the $1.3 billion that has been recovered.

Consequently, subsequent to the completion of the payout of Mt. Gox bankruptcy proceedings to its creditors, Karpeles will be left with hundreds of millions of dollars worth of bitcoin as profit, for his direct involvement in the loss of nearly $7 billion worth of bitcoins within a two-year span.

“When it’s all sorted out, Karpelès would pretty much get [the] vast majority” of the extra value, Kolin Burges told the WSJ,  a creditor who held 311 bitcoins at Mt. Gox. “So that seems incredibly unfair.”

For creditors like Burges, their previous funds in bitcoin that were stored on Mt. Gox will be processed in Japanese yen, at the same value it had been in 2014. Hence, instead of receiving more than $2.1 million, Burges will receive less than $130,000 for his 311 bitcoins, at a price of $400.

“In the case these are sold, I do not believe it would realistically fetch any kind of value high enough to make this an actual issue,” said Karpeles, denying any wrongdoing in regards to the Mt. Gox case and the theft of user funds.

On paper, the company of Karpeles, called Tibanne, owns about 88% of Mt. Gox as per the WSJ. After the bankruptcy filings are settled, Mt. Gox will be left with a surplus of $977 million worth of bitcoins. Out of that, 88 percent will be granted to Karpeles and in the end, after losing more than $7 billion of user funds, Karpeles will take home $859 million for his role in the demise of Mt. Gox.



Source: https://www.cryptocoinsnews.com/mark-karpeles-will-end-taking-859-million-mt-gox-bankruptcy/

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[ChromaticStar]

In other words, if you run a crypto exchange in Japan, declaring yourself bankrupt is the most profitable thing you can do. The world is laughing at you Japan.

If Karpeles feels any sense of responsibility for the damage he's done, he'll take his "winnings" and voluntarily refund them all to the creditors who rightfully deserve them.

[Estimated]

That guys should not walk away with anything really. He should be held liable for the losses that the investors had if they kept their bitcoins with them and he should not walk away with the excess. That's pretty much stupid.

[audaciousbeing]

Although, people have always exploit the law of the land as an easy way of being held accountable for their recklessness either by omission or intention, what I see here is something sensible that the court have ensured because any judgement will not ask the defendant to pay what its obvious he cannot afford. Even though its not the best every one is expecting, its still something that would make it go round if valued at $400 compared to if valued at $7000.

The concern I have against the judgement is that, the man who has been found to be held responsible should not be made to profit from such exercise no matter the justification that surrounds it.

One thing to take out of this whole process is that no matter how anonymous bitcoin is, you cannot hide for long and for those exchange sites with the motive of bolting one day with investors money, they had start having a rethink.

[buwaytress]

And only just a couple of days ago I had been wondering what news of that trial. Bankruptcy is a tool of the elite, used often in every country including mine for the wealthy to escape punishment. Yet another ugly consequence of the current financial system if this is true.

What's worse is that this guy is saying that he wants to reimburse all creditors (then why didn't they get informed) and that even that amount of money won't be enough to do, so he is even now asking for interested buyers of his co rights. Even considering an ICO. Amazing, really.