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Currencies BitCoin Bitcoin: Tokyo Court Starts MtGox Bankruptcy Proceedings

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Nobuaki Kobayashi, the lawyer in charge of failed bitcoin exchange MtGox, announced today that the Tokyo District Court issued an order for the commencement of bankruptcy proceedings. At the same time, the court appointed him as the bankruptcy trustee.

‘’The power and authority to administer and dispose of the assets of the Company is vested exclusively in the bankruptcy trustee, and the bankruptcy trustee will implement the bankruptcy proceedings, such as the administration and realization of the Company’s assets and the investigation of the claims. We kindly ask for your understanding and cooperation.’’

The PDF file posted on the MtGox website has a long section for questions and answers. Unfortunately, most of the answers give little clarity on what is to be expected in the future. For example, it is still unknown how the assets entrusted to the company will be distributed among former clients and creditors. MtGox recently announced that they have ‘’found’’ 200.000 bitcoins in an old wallet. Will these bitcoins be returned as btc or liquidated first and the resulting cash distributed? The difference can have a dramatic impact on the bitcoin market price. Another question being asked around is can the funds gained by the liquidation of the bitcoins be used to compensate other MtGox creditors beside the traders?

The court set a date of July 23rd 2014 for a creditor meeting. Creditors will not lose their claim if they don’t attend the meeting. The trustee will post an official form that interested creditors can use to file their claims online.

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