CryptoPotato
CryptoPotato
  • Crypto News
  • Margin Trading
  • Guides
    • Bitcoin & Crypto Guides 101
    • Bitcoin For Beginners
    • Editorials
  • Fund
  • Buy
  • Language
  • Crypto News
  • Bitcoin For Beginners
  • Cryptocurrency Guides 101
  • Editorials
  • Bitcoin & Crypto Margin Trading
  • Bitcoin Price Analysis
  • CryptoPotato Crypto Fund
  • Ethereum (ETH) Price Analysis
  • Ripple (XRP) Price Analysis
  • Market Updates
  • Interviews
  • Buy Bitcoin with Card
  • bitcoin
    BTC$48,812.00
  • ethereum
    ETH$1,522.05
    • Market Updates
    • BTC Analysis
    • ETH Analysis
    • XRP Analysis
    • Interviews
    Home » Crypto News » False Hope? Brock Pierce Led MT.Gox Rehabilitation Feared to Be Fraudulent (Here Is Why)

    False Hope? Brock Pierce Led MT.Gox Rehabilitation Feared to Be Fraudulent (Here Is Why)

    Author: Toju Ometoruwa

    Last Updated Dec 16, 2020 @ 12:03

    TL: DR

    • Brock Pierce, EOS Founder, plans to rehabilitate Mt. Gox
    • Pierce’s motives are questioned as there are already plans to repay MT. Gox creditors
    • There have also been ‘behind the scenes’ disputes regarding Pierce status as the legal owner of MT.Gox post-bankruptcy.

    MT.Gox, the crypto exchange best known for handling over 70% of all bitcoin transactions worldwide in 2014, before having ~850,000 bitcoin (or $450m) stolen during a hack and subsequently filing bankruptcy.

    Gox was and continues to be a permanent black mark in the history of the crypto space. Years later, there are now plans to revive the service in order to recover the lost funds and make creditors whole by once again generating revenue.

    Brock Pierce, the Founder of EOS and Block.one, is spearheading the plan. In rehabilitating MT. Gox, Brock has promised to:

    • Value all claims at 100% of their current value.
    • Explore avenues to recover more of the missing Bitcoins.
    • Fight the CoinLab lawsuit.
    • Distribute any existing funds to creditors.
    • Restart a new exchange from MT.Gox’s ashes, in which creditors may receive a 16.5% equity stake for free, enabling additional recovery via profits.

    Even though these promises look encouraging, evidence from people who have watched more closely into the plan shows that there are significant pitfalls and hidden motivations behind it.

    brock_pierce
    Brock Pierce. Image credit: Wikimedia Commons

    Pierce promises already seem to be taken care of by the Mt.Gox team

    For one, creditors have already solved the problem of being repaid. When MT.Gox filed for bankruptcy in 2014, the claims valuation was priced $483 per BTC. However, the increasing price of BTC over the years meant that the bankruptcy had surplus assets that were required to be distributed to shareholders.

    The credits that fought against this surplus distribution won the right to convert the case back to ‘civil rehabilitation’ in 2018 for a fair re-evaluation of claims.

    Second, experts who have studied the case don’t believe Pierce claims that the still missing 650,000 BTC can be recovered.  Pierce has provided no specific plans about how to recover them.

    Third, MT.Gox’s Trustee is already fighting against the CoinLab lawsuit. CoinLab was once partnered with Gox to help them develop their business, but following the crash, CoinLab sued MT.Gox for $75 million and has now increased their lawsuit to an absurd $16 billion. Unless Pierce has conducted some backdoor deals, there’s no way he can help make the lawsuit disappear any faster.

    Pierce has promised not to use any creditors funds to launch a new exchange and instead will pay the creditors out as soon as possible. This is essentially what MT.Gox’s Trustee has promised to do. There are no details regarding how Pierce plans to solve the settlement faster than the Trustee (who is one of Japan’s most prominent and experienced bankruptcy lawyers).

    False assumption of ownership over MT. Gox

    It appears that Pierce’s promises are based on a false assumption that he already owns MT. Gox.  Soon after the exchange filed bankruptcy, Pierce Company – Sunlot – negotiated with the CEO (Mark Karpelès) to acquire and rehabilitate it. A formal letter of intent was filed, but the language in the letter only indicated that they would intend to proceed with negotiations.

    Mark Karpelès reached out to Pierce at a later date to confirm that the letter was rescinded. However, he received no response from him and was later accused by Pierce for reneging on the agreement.

    Conclusion

    Ultimately, this sounds like all the more reason for people to steer clear of MT. Gox and any attempts at rehabilitation. With lawsuits still on-going and disputes over who even owns what’s left of the exchange, this is no place for Bitcoin investors to sink their money into.

    Enjoy reading? Please share:
    Facebook Twitter LinkedIn Telegram
    SPECIAL OFFER (Sponsored)
    Binance Futures 50 USDT FREE Voucher: Use this link to register & get 10% off fees and 50 USDT when trading 500 USDT (limited offer).

    PrimeXBT Special Offer: Use this link to register & enter CRYPTOPOTATO35 code to get 35% free bonus on any deposit up to 1 BTC.

    Read more on: Mt. Gox

    About The Author

    Toju Ometoruwa View more posts by this author

    Toju Ometoruwa is a Northeastern University alumni who is the co-founder of Pazima, a start-up that provides secure lending options for low-income workers. His passion is to empower communities across the African diaspora through the blockchain.

  • bitcoin
    BTC$48,812.00
  • ethereum
    ETH$1,522.05
  • Join Our Community

    FacebookTwitter YouTubeTelegram


    ADVERTISEMENT
    pionexb
    2local
    Bitcoin Editorials
    What is Dogecoin (DOGE)? 5 Facts About the Crypto That Started as a Joke 

    What is Dogecoin (DOGE)? 5 Facts About the Crypto That Started as a Joke 

    The Laser Eyes Meme: Not a Coincidence That This Marked a Local Top for Bitcoin (Opinion)

    The Laser Eyes Meme: Not a Coincidence That This Marked a Local Top for Bitcoin (Opinion)

    What Are the Risks of Governance Tokens? (Opinion)

    What Are the Risks of Governance Tokens? (Opinion)

    The Bitcoin Bubble Effect: Yes, We Are in a Very Early Stage (Opinion)

    The Bitcoin Bubble Effect: Yes, We Are in a Very Early Stage (Opinion)

    Will Bitcoin Price Rally Continue In 2021? 8 Key Considerations

    Will Bitcoin Price Rally Continue In 2021? 8 Key Considerations

    Join Our Newsletter
    Become a CryptoPotato VIP
    One Weekly Email Can Change Your Crypto Life.
    Sign-up FREE to receive our extended weekly market update and coin analysis report
    We NEVER send spam. You can unsubscribe at any time.
    Invalid email address
    Thanks for subscribing!
    About
    Advertise on CryptoPotato
    About Us | Contact Us

    Terms of service | Privacy Policy | GDPR
    More Sections
    IEO List | Evaluations
    Airdrops
    Scholarship
    Cannabis Stocks News | Market Analysis
    Disclaimer
    Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. Full disclaimer
    © Copyright CryptoPotato 2016 - 2021
    Scroll to top
    One Weekly Email Can Change Your Crypto Life.

    Sign-up FREE to receive our extended weekly market update and coin analysis report

    We never send SPAM. You can unsubscribe at any moment
    Invalid email address
    Thanks for subscribing!