Mt Gox’s two largest creditors, Bitcoinica and MtGox Investment Funds (MGIF), have chosen to get their bankruptcy recovery funds paid out in bitcoin according to sources close to the matter, in what will be the first major reimbursement following the bitcoin exchange’s collapse in 2014.
Bitcoinica's and MGIC's claims comprise a combined 20% of the approximately US$3.4bn expected to be paid out to creditors.
The vast sums of bitcoin locked up in the Mt Gox bankruptcy have been a bugbear for the market in recent years, with fears that a large-scale sell off could tank the price of bitcoin.
Since creditors were able to take a cash option – by which the bankruptcy trustee would be forced to convert its BTC holdings into fiat – the fact that both Bitcoinica and MCIG have decided to retain their funds in BTC should allay those fears somewhat.
Creditors, however, can still cash out their bitcoin when received.
According to analysis by Blockchain Research Lab, over 802,000 bitcoins were stolen from Mt Gox users following the 2014 hack, which would amount to more than US$19bn today, but less than 142,000 were recovered.
Mt Gox founder Mark Karpeles claimed that Mt. Gox had 1.1 million active accounts in 2013, indicating only around 2.1% of all active accounts actually filed a claim.
Creditors were given the option of cashing out a lump sum now at a 10% discount or waiting for ongoing litigation to finish at an unspecified date in the future.