Pag wrote in his resignation letter that he told the 1,000 claimants represented by Mt. Gox Legal that he is not expecting to see any closure in the case for at least another 18 months. He explained that this delay is due to CoinLab raising its bankruptcy claim against former partner Mt. Gox from $75m to $16bn.
CoinLab made its adjustment after Mt. Gox Legal changed its operations from bankruptcy proceedings to civil rehabilitation proceedings. When that switch will be completed, small creditors will be able to claim bitcoin at their 2019 value instead of its 2014 price.
Pag stated that all creditors that made claims to the bankruptcy proceedings of the Mt. Gox just refiled the claim when civil rehabilitation started. Then all legitimate creditors need to receive approval and then the payment plan has to be approved by the court and with all verified creditors.
Pag stated that Mt. Gox will not enter its civil rehabilitation phase until the plan receives approval from creditors.
“We’ve started that process but it’s not finished and it’s not confirmed, it’s not confirmed that we’re in civil rehabilitation until the creditors vote on a civil rehabilitation plan.”-said Pag.
Mark Karpeles, the former CEO of Mt Gox, believes that CoinLab’s strategies will be quickly settled by the Tokyo District Court. He also stated that CoinLab never really brought any contributions to Mt. Gox, a claim which is denied by CoinLab. CoinLab reasons that the original lawsuit would have been dismissed by the court if this were true.
“Courts are likely to consider CoinLab’s case with some matter of urgency today and will likely try to get things handled quickly, but CoinLab has likely no interest of bringing a losing battle to its conclusion, and will likely try to extend the process as much as possible.”
If CoinLab receives approval, the value of the claim will be 16 times more than the total assets that are reserved for distribution to Mt. Gox’s creditors.