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Author Topic: Gox Files for Bankruptcy.  (Read 1032 times)
kthejung
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February 28, 2014, 11:08:31 AM
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http://www.usatoday.com/story/money/markets/2014/02/28/bitcoin-mt-gox-collapse-japan/5891841/
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grifferz
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February 28, 2014, 11:09:53 AM
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You meant to say "protection from bankruptcy", which is very different.
ab8989
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February 28, 2014, 11:29:33 AM
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You meant to say "protection from bankruptcy", which is very different.

I think he meant to say MtGox has filed for bankruptcy with protection from creditors which is very different from what you said but not that different from just "Gox files for Bankruptcy".

Bankruptcy protection is just one possible flavour of bankruptcy with the other common flavour being liquidation bankruptcy.
grifferz
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February 28, 2014, 11:31:44 AM
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My understanding was that bankruptcy protection was similar to chapter 11 protection in the US, which allows for continued trading and restructuring. Is that not the case?

If it is the case, that is very different from just the connotations of "bankruptcy" which would be an admission that it is all over now.

(though I guess even if it is like chapter 11 it could well still all be over as they may never come up with a suitable plan)

Is it different in Japan?
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February 28, 2014, 11:41:07 AM
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from wikipedia: Chapter 11 is a chapter of Title 11 of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business.

The US Chapter 11 is a form of  bankruptcy.
NickPortland
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February 28, 2014, 11:43:53 AM
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You meant to say "protection from bankruptcy", which is very different.

With 870k BTC "stolen", how can they NOT declare bankruptcy?

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February 28, 2014, 11:47:42 AM
 #7

My understanding was that bankruptcy protection was similar to chapter 11 protection in the US, which allows for continued trading and restructuring. Is that not the case?

If it is the case, that is very different from just the connotations of "bankruptcy" which would be an admission that it is all over now.

(though I guess even if it is like chapter 11 it could well still all be over as they may never come up with a suitable plan)

Is it different in Japan?

"Bankruptcy" in Japan implies liquidation.  There are other forms of insolvency which imply an attempt at restructuring (the magic word is "rehabilitation").  It's not clear exactly what's going on.  Some people claim that the words "civil rehabilitation" were mentioned in the press conference but it's difficult to imagine how it would even be possible/approved with such a huge shortfall of funds (a total of 870,000 BTC plus $63.6 million in cash that we know of so far).

Hopefully the financial media will clarify things over the next couple of days.  Perhaps for some strange reason the "stolen" BTC aren't being regarded as a debt in the insolvency.

All I can say is that this is Bitcoin. I don't believe it until I see six confirmations.
techstorm3
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February 28, 2014, 11:52:37 AM
 #8

My understanding was that bankruptcy protection was similar to chapter 11 protection in the US, which allows for continued trading and restructuring. Is that not the case?

If it is the case, that is very different from just the connotations of "bankruptcy" which would be an admission that it is all over now.

(though I guess even if it is like chapter 11 it could well still all be over as they may never come up with a suitable plan)

Is it different in Japan?

"Bankruptcy" in Japan implies liquidation.  There are other forms of insolvency which imply an attempt at restructuring (the magic word is "rehabilitation").  It's not clear exactly what's going on.  Some people claim that the words "civil rehabilitation" were mentioned in the press conference but it's difficult to imagine how it would even be possible/approved with such a huge shortfall of funds (a total of 870,000 BTC plus $63.6 million in cash that we know of so far).

Hopefully the financial media will clarify things over the next couple of days.  Perhaps for some strange reason the "stolen" BTC aren't being regarded as a debt in the insolvency.

As btc is not recognized as legal tender that could well be the case.

grifferz
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February 28, 2014, 11:52:51 AM
 #9

from wikipedia: Chapter 11 is a chapter of Title 11 of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business.

The US Chapter 11 is a form of  bankruptcy.
Yes, but do you not accept that:

Quote
X has filed for bankruptcy

implies to most folks that X is throwing in the towel whereas:

Quote
X has filed for bankruptcy protection

implies that X feels it can eventually get back to being a profitable functional business?

I understand that these are both forms of bankruptcy, but one sounds a lot more final than the other and I think it's an important distinction to make especially when a lot of people are only going to look at the topic subject.
Alphi
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February 28, 2014, 11:54:30 AM
 #10

My understanding was that bankruptcy protection was similar to chapter 11 protection in the US, which allows for continued trading and restructuring. Is that not the case?

If it is the case, that is very different from just the connotations of "bankruptcy" which would be an admission that it is all over now.

(though I guess even if it is like chapter 11 it could well still all be over as they may never come up with a suitable plan)

Is it different in Japan?

It is quite ok to say that "Mt Gox filed for bankruptcy" because chapter 11 is the 11th chapter of the bankruptcy code, so it is technically part of the process called bankruptcy.

chapter 11 is usually the very last step before the company is completely desolved.. very few companies come out of that alive. source: Me, I've been a trader for years.
usually the "restructuring" involves selling all the assets off to another company in a firesale (look at THQ and OZC for example).. as far as the investors and creditors are concerned.. their money is toast.
the sad thing is that CEO's rarely go to jail when a company goes bankrupt... Mr Karpeles Kartmenez should go to jail for his continued negligence IMO.. he continued to run the company knowing that it was insolvent and deliberately took peoples money when he knew there was no way honor them if they wanted to withdraw... that's gross negligence bordering on criminal negligence or fraud in my book.

what Karmenez did makes Charlie Shrem look like Charlie Shrimp.

EDIT.. Just re-reading the article it looks like they only came up short by $65 million instead of the much worse figure of several hundred millions of dollars... so each person could still get back a fair chunk of the BTC they had stored there after a VERY VERY long process.... however, for a double whammy the BTC they had stored there is now devalued even further by this debacle....

I'm lucky on only had like .02 btc there lolz... dont think ill bother waiting in line to get my money back.

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