Andy Pag, founder of Mt. Gox Legal, resigned as head of the organization. The organization is the representative of many Mt. Gox creditors (when the exchange collapsed, the funds of these users are still on the platform). Although some reports say that these users can get paid at the earliest this year, Pag believes that the Mt. Gox partner, the startup company CoinLab's application for a sky-high price claim, will slow down the entire payment process.
CoinLab's $16 billion claim
It may take many years for creditors to get compensation. The cryptocurrency available for distribution has been partially liquidated, but the exchange still holds a large amount of bitcoin, bitcoin cash (BCH) and Bitcoin SV (BSV), which is a substantial amount.
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CoinLab has filed a $16 billion claim against Mt. Gox for a profit sharing agreement. The $16 billion far exceeds the amount of assets held at the close of the exchange. Brock Pierce estimates that the exchange currently holds approximately $1 billion in assets. CoinLab's $16 billion claim is very interesting. They previously only asked for $75 million in compensation. In 2013, the company filed a lawsuit against Mt. Gox, alleging that the exchange failed to fulfill its promise when it terminated its cooperation.
CoinLab's claim has led to many problems in the creditor's repayment process due to the voting rights of civil reinstatement. If CoinLab's application is approved, it will actually have more voting rights than others, but its request has not yet been approved. The Mt. Gox custodian immediately rejected the application, but CoinLab is still fighting. Other creditors are angry about the matter.
In June last year, when Mt. Gox re-entered the civil recovery process, many people thought that the payment would be completed by the end of 2019 – in the form of cryptocurrency or encryption combined with fiat currency. It now appears that it will take years to complete the process, and many people blame it directly on CoinLab.
Selling Bitcoin Claims at Low Price
According to Pag, the person who made the claim when Mt. Gox was in the bankruptcy process only needed to resubmit the application during the civil recovery phase. Simply put, all legal creditors need to be approved, and the court will then approve the claims with the creditors.
However, Pag pointed out that Mt. Gox did not even enter the civil recovery phase until the creditors approved the compensation plan.
We have already started this process, but it has not been completed and has not been confirmed. Before the creditors voted on the civil recovery plan, we have not been told that the process has begun.
Mark Karpeles (former CEO of Mt. Gox) believes that the Tokyo District Court will promptly process CoinLab's application. He also said that CoinLab has never really done anything for Mt. Gox – even though CoinLab is the opposite. CoinLab believes that if the original lawsuit really failed, the court will certainly reject it.
The court may deal with CoinLab's case as soon as possible, but CoinLab has no intention of playing a failed lawsuit, so they will extend the trial process as much as possible.
Andy Pag is selling his Mt. Gox claim to free himself from the pain at a price of only $600 per BTC. He published a letter in a private forum explaining why he did it.
Pag believes that the sale of his Bitcoin claim application meant that he lost the qualification to manage the victim organization. Mt. Gox Legal represents approximately 1,000 claimants and the assets claimed represent 15% of the exchange's BTC assets.
The operating expenses of this organization come from the donation of creditors. Therefore, some people expressed dissatisfaction with the organization and thought that it cost $200,000, but nothing happened.
Perhaps the most noteworthy part of Pag's resignation plan is his long-term prediction of the payout process. He believes that "Mark is plotting something again."
He explained that Karpeles wanted his company Tibanne to go out of bankruptcy protection against CoinLab, the parent company of Mt. Gox.
What makes me very annoyed is that after all the plots from 2011 to 2014, he started to act again, trying to win the complicity and returning his own way. I don't think he is malicious, but the person I saw is ruthless, and I suspect that he will only be interested in helping creditors if he is in his own favor.
Recently Karpeles was relieved of most of the allegations related to the bankruptcy of Mt. Gox and tried to overturn his verdict.