Former Mt. Gox CEO Mark Karpeles led the ongoing debate surrounding the leadership of 1Feex and its connection to the Mt. Gox hack.
Founded in 2010, Mt. Gox was once the world’s largest Bitcoin exchange, estimated to have facilitated around 70% of all BTC transactions before its implosion.
The defunct exchange lost 4% of all Bitcoin issued in a security incident in 2014, which resulted in the theft of more than 850,000 Bitcoin (BTC), worth approximately $450 million. The event made Mt. Gox one of the biggest cryptocurrency bankruptcies of all time, and its creditors have yet to be repaid nine years later.
The amount of Bitcoin to be paid to Mt. Gox creditors is comparable to the Bitcoin holdings of business intelligence firm MicroStrategy, which owns at least 152,333 BTC ($4.52 billion).
Since then, the search for the stolen Bitcoin has continued. In 2019, a group of creditors filed a petition for civil rehabilitation to recover the lost funds. The trustee in charge of the Mt. Gox estate, Nobuaki Kobayashi, has been selling the remaining assets of the exchange to pay off creditors.
Recently, Australian entrepreneur and self-proclaimed Bitcoin creator Craig Wright claimed ownership of the 1Feex address, which has been linked to the Mt. Gox hack. Wright’s claims have raised questions ever since the 1Feex address received a significant amount of Bitcoin in 2013, around the same time as the Mt. Gox hack.
The Mt. Gox Scandal Takes a New Twist
The controversy deepened further when former Mt. Gox CEO Mark Karpeles addressed the ongoing debate surrounding the leadership of 1Feex and its connection to the Mt. Gox hack.
Wright had claimed ownership of the 1Feex address, stating that the funds received were acquired through legitimate means.
However, Karpeles issued a statement certifying that the 79,956.55 Bitcoin sent to the 1Feex address on March 1, 2011, was transferred without proper authorization from the exchange’s original Bitcoin wallet and is considered stolen property belonging to Mt Gox estate for the benefit of Mt. Gox creditors.
Karpeles’ statement raises serious questions about the legitimacy of Wright’s property claims and the possibility that he received stolen funds, or was even an active participant in the Mt. Gox hack.
Destination of Stolen Funds Remains Unclear
The scandal surrounding the defunct cryptocurrency exchange has been at the forefront of the cryptocurrency industry for years, and this recent controversy only adds to the intrigue. As the legal battle continues, the fate of the stolen funds and the future of Mt. Gox’s creditors remain uncertain.
There are some potential outcomes for Mt. Gox creditors:
Full Refund: The best-case scenario for creditors would be to receive a full refund of their lost funds. However, this outcome seems unlikely, as the number of Bitcoins stolen far exceeded the number of assets recovered.
Partial Refund: Another possible result is that creditors will receive a partial refund of the lost funds. This could happen if the trustee is able to recover more assets or if the remaining assets are worth more than expected.
No Refund: The worst-case scenario for creditors would be no refund at all. This could happen if the remaining assets are not worth enough to cover creditors’ claims or if legal battles drag on for years without resolution.
By Audy Castaneda
