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Bitcoin Mt. Gox Creditors Will Soon Benefit From a $9 Billion Refund: Their BTC Are Worth 10,000% Higher Than When They Disappeared
Bitcoin exchange Mt. Gox is best known today for its infamous suspension of operations and bankruptcy in February 2014, a multi-million dollar loss to the Bitcoin community at the time. Since 2014, and after many lawsuits, Mt. Gox has managed to recover a very useful amount of Bitcoin and is now sending an amount valued at $9 billion split among former Mt. Gox account holders [h/t CNBC].
The original Mt. Gox bitcoin theft resulted in the loss of “up to 950,000 bitcoins,” and of those recovered bitcoins, 140,000 are reportedly being returned to former Mt. Gox customers.
While not all of the lost Bitcoins have been recovered—far from it—the exponential rise in the value of Bitcoins since February 2014 means that each recovered Bitcoin is worth 10,000% more than when it was lost. As John Glover of cryptocurrency lending firm Ledn told CNBC, “A lot of people are clearly going to cash in and appreciate that having their assets locked up in the Mt. Gox bust was the best investment they ever made.”
Depending on the party receiving the payment and the amount they receive, however, the story could change. According to Luke Nolan of research firm CoinShares cited by CNBC, many Mt. Gox creditors who opt for in-kind repayment (in Bitcoin) do so because of tax implicationsJPMorgan, quoted by CNBC, suspects similar reasoning on the part of creditors, although JPM also suspects they are accepting in-kind repayments “because they believe liquidating now would negate potential further price gains in the future.”
Ledn’s previously mentioned John Glover also speculated that “those in jurisdictions with capital gains taxes may choose to hold their positions to avoid this huge tax bill and instead use their Bitcoin as collateral to borrow dollars, thereby monetizing the Bitcoin without having to sell it.”
In any case, it seems that those who have held out this long have been waiting for theirs cryptocurrency instead of selling their failed claims at previous high bids, they will be highly rewarded with huge gains on their returned old cryptocurrencies. However, since not all cryptocurrencies have been recovered, it is unclear exactly how much everyone involved can earn compared to what they invested, although considering the price of Bitcoin then compared to now, it would appear that at least they will be made whole, if not much better than before.