Hedge Funds Are Buying Mt Gox Bitcoin Claims

Mt Gox creditors have waited for over three years to see some of their lost bitcoins returned, but the end is still not in sight. However, a number of them may be able to cash out soon since some hedge funds are now buying Mt Gox claims, offering 15 percent of the claims’ value in cash.

Also read: CoinLab Lawsuit Delaying Mt Gox Payouts: Trustee

How to Sell Mt Gox Claims

A website called Mygoxclaim, has been created by some Mt Gox creditors to connect claimants with interested buyers. According to the Financial Times, Daniel Kelman, an attorney representing creditor interest in the case and a Mt Gox creditor himself, is one of the people responsible for setting up the site.

Created last week, this website serves “as an information portal and liaison to help you sell your claim in the MtGox bankruptcy”. The owners claim to have friends in finance and found some people interested in purchasing claims. “There are indeed parties interested in purchasing claims on a claim by claim basis”, they wrote, adding that:

We’re in touch with third parties who are interested in purchasing claims and can help broker a deal. Purchasers are interested in claims above $10,000 USD in value, but every claim will be considered.

“The process is simple”, the site noted, adding that interested sellers need to send an email with their claim information including name, claimed amount, and whether the claim is in bitcoin or fiat. “We need sufficient information to identify you and your claim so we can get you an offer”, the website says. In addition, “serious inquiries only”, it further informs citing that “there will be due diligence to make sure your claim is real before any transaction takes place”.

Mt Gox Creditors

When Mt Gox closed its doors for the last time in late February 2014, it had already been denying all withdrawals from the exchange for several weeks as the price fell sharply. In April 2014, the exchange announced that around 850,000 of their customers’ bitcoins were missing.

Local Japanese investigators were quickly brought in but investigations have been slow. In November 2014, bitcoin exchange Kraken was appointed by the Japanese court to help with the investigation of missing bitcoins and the distribution of assets to Mt Gox creditors. Last May, Kraken confirmed that the amount of bitcoin held by the Mt Gox estate is approximately 202,185 bitcoins, which represents less than a quarter of the amount lost.

According to Kraken, 24,750 creditors have filed claims as of last May. The list of all eligible claimants can be found on the Mygoxclaim website.

Possible Incentives to Sell

At least four hedge funds in the United States and Japan have begun buying or offering to buy claims from many thousands of Mt Gox claimants, the Financial Times reported. Claimholders can sell their claims now and “receive 15 per cent of the yen value of each claim in cash” the publication was told.

“For three years we have followed the proceedings and grown increasingly frustrated at the slow pace of events”, Mygoxclaim website owners wrote. The claim is now going on its fourth year and could take significantly longer to settle since there are also five other Mt Gox-related legal disputes going on. For example, the $75 million lawsuit filed against Mt Gox by its former business partner Coinlab has to be resolved before claims can be settled.

Given a long wait time ahead for claimants, Mygoxclaim website owners noted that:

It has been three years and the end is not yet in sight. For those who don’t want to wait, or who need payment now, or who simply think they would be better off investing whatever return they could get on their own, there is now an option worth considering.

Do you think Mt Gox creditors should sell their claims? Let us know in the comments section below.

Images courtesy of Shutterstock, Mt Gox, and Kraken

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