Sueball-slingers seek stake in bankrupt Bitcoin blunder bunker MtGox
Stung investors offer to settle class actions for slice of new exchange, coinage
US and Canadian Bitcoin investors have offered to settle their class-action lawsuits against the bankrupt MtGox exchange in return for a stake in the firm and the return of any of the digital currency it still holds.
The Bitcoin traders told the courts that they support a plan by Sunlot Holdings to buy up MtGox and will drop their suits in return for a 16.5 per cent stake in the exchange after the sale and their share of the Bitcoins it still holds.
MtGox hit the skids earlier this year, applying for bankruptcy protection in both Japan and the US after saying it had lost 850,000 Bitcoins, including 750,000 belonging to its customers, worth over $400m. Investors immediately sued the firm for their lost investments, alleging, among other things, that the exchange had not adequately securely stored or timeously detected the theft of those coins - and had not sufficiently secured investors against such an eventuality.
The exchange told the Tokyo District Court earlier this month that it had no viable plan to revive itself and sought approval to be liquidated and/or sell itself off. As well as having the business itself to see off, MtGox has claimed to have found around 200,000 of the Bitcoins it lost, giving it some reasonable assets to attract a white knight.
In a court filing in the US, the investors said that the proposed settlement was an “extraordinary turn of events” that could potentially fully compensate all customers of the exchange and keep MtGox running.
“The proposed settlement (and reorganization plan) now before the Court is a more than fair, reasonable and adequate result for the proposed settlement class and is well within the range of possible approval.
"Given its substantive terms, the relief provided to the class and exchange members globally, and the support of an international cast of interested parties, the Court should not hesitate to grant preliminary and ultimately, final approval to the deal,” the filing said.
The settlement plan calls for the immediate distribution of any Bitcoins or currency still held by MtGox to members of the exchange, including the 200,000 units of the e-currency that turned up. A new exchange would then be created with existing MtGox customers holding a 16.5 per cent stake.
In addition, MtGox founder Jed McCaleb and chief marketing officer Gonzague Gay-Bouchery have agreed to cooperate with any continued litigation “against the non-settling defendants”, which include CEO Mark Karpeles.
The new exchange has also promised to try to get to the bottom of how MtGox lost everyone’s money and attempt to recover it.
The settlement will need the approval of courts in the US and Canada and the exchange’s sale to Sunlot will also need the nod from the Tokyo bankruptcy court. Sunlot has been trying to buy MtGox since it filed for bankruptcy in January and is offering to pay a token one Bitcoin (currently hovering just under $450), according to the Wall Street Journal.