Gox Rising FAQ

 

In this section, you can find a list of Frequently Asked Questions (FAQs) together with our answers. Send us additional questions that you would like to be included here as well as any comments you may have.

 

Check out Media for Gox Rising press releases and updated Mt Gox news stories.

In our Library you can find important documents related to the Mt Gox proceedings

General

How will Gox Rising communicate with Creditors and the crypto community?

Our regular communication and your feedback is of extreme importance to us. In addition to the information presented on this website (which we will continue to update and improve), we will be conducting weekly webinars to keep everyone informed of our efforts.

Please check the home page of this website for upcoming dates.

How can Creditors and the crypto community communicate with Gox Rising?

If you are a Creditor to the Mt. Gox Estate, you can join our collective efforts to maximize your recoveries by completing the on the home page.

Please study the information on this website carefully, participate in our webinars and let us know any concerns or suggestions for improvement that you may have.

What do I do if I have a question that is not answered here?

You can also sign up on this website to receive more information, get help determining the status of your claim, and find additional documentation regarding the status of the ongoing legal case.

What is Mt. Gox?

Mt. Gox was started as a trading card and Bitcoin exchange based in Shibuya, Tokyo, Japan. Originally launched in July 2010, by 2013 and into 2014 it was handling over 70% of all Bitcoin (BTC) transactions worldwide, as the largest Bitcoin intermediary and the world’s leading Bitcoin exchange.

What happened to Mt. Gox?

From the day it was first incorporated in Japan, MTGOX had insolvency problems and ran as a fractional reserve. It was also hacked multiple times over multiple years, making the deficit worse, with the majority of its coins stolen from a compromise of its hot wallet on September 11, 2011. MTGOX did not realize the hot wallet was compromised, and kept using it until it shut down. The coins were slowly siphoned out of the hot wallet over years, resulting in the loss of almost all customer Bitcoin holdings, except for a long forgotten cold wallet with 202,000 BTC in it. MTGOX went into a bankruptcy process known as Civil Rehabilitation in early 2014, then changed to liquidation in mid 2014, and went back to Civil Rehabilitation in mid 2018. It is a very complex bankruptcy case with tens of thousands of creditors worldwide.

What assets does the Mt. Gox Estate currently hold?

The Estate is comprised of cash, cryptocurrency, databases, trademarks, and other tangibles and intangibles.

What is Civil Rehabilitation?

民事再生法
平成十一年十二月二十二日法律第二百二十五号
The Civil Rehabilitation Act No. 225 of December 22, 1999

Article 1 The purpose of this Act is, by formulating, for debtors in financial difficulties, rehabilitation plans as consented to by a number of their creditors and confirmed by the court, to appropriately coordinate the relationships of rights under civil law between such debtors and creditors, with the aim of ensuring the rehabilitation of the debtors’ business or economic life.

SOURCE: http://www.japaneselawtranslation.go.jp/law/detail_main?vm=&id=125

Who is the Trustee for the Civil Rehabilitation process?

Nobuaki Kobayashi at Nagashima, Ohno, and Tsunematsu

SOURCE: http://www.noandt.com/data/lawyer/index/id/2957/

Who are the Creditors to the Mt. Gox Estate?

Creditors are those who had Cash and Coin balances on record with the exchange at the time of Mt Gox Bankruptcy Filing.

How many Creditors have come forward to make a claim?

As of the May 25, 2016 bankruptcy case filing, 24,766 claims were filed with the Trustee.

How have the Creditors organized to represent their interest?

Vocal creditors have created websites like mtgoxlegal, wizsec, goxdox, and channels on Reddit and other forums. Law firms have worked with Creditors to interface with the Tokyo District Court and the Trustee Nobuaki Kobayashi at the law firm Nagashima, Ohno, and Tsunematsu.

What work has been done for Creditors so far?

WizSec solved the MTGOX mystery for everyone showing in some detail where the missing coins went. At one time Kraken helped file claims with the Trustee, however now the Trustee is doing it alone. The Trustee has processed all the liquidation claims which was a large task. Creditors have been served by the Japanese Courts and Civil Rehabilitation process in the manners described by Japanese Law. To date the Trustee has captured value for the Estate by selling BTC at favorable prices. – Despite this progress, distribution of cash or coin has creditors waiting for years and cases like CoinLab threaten to delay the process further.

Gox Rising

What is Gox Rising?

Gox Rising Limited (“Gox Rising” or the “Company”) is a new corporation formed under the laws of the British Virgin Islands. The Company is controlled by Brock Pierce and will be co-owned by Brock with senior management and investors.

What are the goals of Gox Rising?

Gox Rising was established for two interrelated objectives: (1) to maximize and accelerate recoveries for Creditors, and (2) relaunch the Mt. Gox exchange.
We are looking to assist Creditors because (i) it is the right thing to do for both the Creditors themselves as well the Bitcoin community in general, and (ii) we are hoping to launch the new Exchange with the support of the Creditor community while sharing the upside to allow them a further source of recovery for their claims.

What has Gox Rising published?

We have published two documents: (1) what we believe to be the pillars of any Civil Rehabilitation plan for Mt. Gox, and (2) our vision for a newly relaunched Mt. Gox Exchange.
Both can be found on our website under the “Documents” menu item.

How will Gox Rising make money?

The Company plans to use the acquired intellectual property to relaunch the Mt. Gox Exchange and seeks the support of the Creditor community in this process.

As part of this effort, the Company plans to share 16.5% of the economics of the Exchange with participating Creditors who choose to opt-in to accounts with the new Exchange.

This will allow those Creditors to continue to earn money towards full recovery of their claims even after the Trustee has disbursed the assets of the Mt. Gox Exchange. The Company, on the other hand, will benefit from potentially tens of thousands of account holders to launch its business.

Management and investors in Gox Rising will make money from the remaining 83.5% of the economics of the Exchange.

How will Gox Rising NOT make money?

The Company will NOT seek any share whatsoever in the cash and coin held by the Trustee as part of the Mt. Gox Estate.

It will also NOT seek to benefit in any way from any efforts to recover the Missing Coins or any Other Residual Assets (as further described below).

To the contrary: Gox Rising is planning to pay (i) fair market value the Estate in order to acquire the intangible assets of Mt. Gox, including brand name, domains and other intellectual property, and (ii) provide initial funding to a Foundation (without any control or other involvement by Gox Rising) to assist in the recovery of the Missing Coins and Other Residual Assets).

What if we fail?

We have significant resources, extensive relationships both within the crypto as well as the “old” world and a fair amount of experience. However, success is never guaranteed and will require both a tremendous amount of work as well as your support.

Should we fail at relaunching the Exchange, then Creditors will bear NONE of the cost and merely loose the potential economics from a 16.5% share in a new business.

As venture entrepreneurs and investors, we are experienced in bearing the risks on our side. Should we succeed, however, our collective upside will be tremendous.

The Relaunched Mt. Gox Exchange

Why try to launch a new exchange under the Mt. Gox brand?

We believe that there is tremendous value in relaunching the Mt. Gox exchange with support of its former customers, the Creditors to the Mt. Gox Exchange.

There has been a lot of talk about how blockchain will create a brave new world yet the industry has not always lived up to expectation. Help us show the world that Mt. Gox is not Lehman Brothers because of the community that supports it.

With that support, a decentralized exchange built and operated to the highest standard can create tremendous value for investors, management and participating Creditors and prove that we are different.

Will Gox Rising make a bid for the intangible assets to the Trustee?

Yes

What will the bid for the intangible assets be based on?

We are commissioning an independent valuation of the intangible assets of the Mt. Gox Estate and will provide this to the Trustee along with our bid.

What is a decentralized exchange?

A decentralized exchange (or DEX) is an exchange market that does not rely on any third party service to hold the customer’s funds. Instead, trades occur directly between users (peer to peer) through an automated process. This system can be achieved by creating proxy tokens (crypto assets that represent a certain fiat or cryptocurrency) or assets (that can represent shares in a company for example) or through a decentralized multi-signature escrow system.

Because users do not need to transfer their assets to the exchange, decentralized exchanges reduce the risk of theft from hacking of exchanges. Decentralized exchanges can also help prevent price manipulation or faked trading volume through wash trading.

This system contrasts with the current centralized model in which users deposit their funds and the exchange issues an IOU that can be freely traded on the platform. When a user asks to withdraw his funds, these are converted back into the cryptocurrency they represent and sent to their owner.

Is Gox Rising aligned with any particular Creditors or group of Creditors?

We are open to discussion with all creditors. We have talked with hundreds of members of the community and will continue to engage with as many members as we can. We have no biases or prejudice (for or against) any person or creditor groups. We are not currently in partnership with any other groups at this time.

What if certain Creditors want no part of the new Exchange?

Participating in the new Exchange and benefiting from its economics will be opt-in for any Creditor.

Creditors that held their claim at the time of bankruptcy of Mt. Gox that do not wish to participate for any reason will always be free to change their mind at a later date to join and benefit.

Will Gox Rising submit its own plan for Civil Rehabilitation to the court?

There has been a lot of confusion around this particular question and we will take part of the blame for not communicating our thoughts clearly enough here in the past.

The ideal scenario is for us to have a single plan for Civil Rehabilitation that is put forward and executed by the Trustee himself. We were looking to join the dialogue and assist in gathering consensus among all Creditors and Creditor groups so that the Trustee can have a high degree of comfort in incorporating this consensus into his own plan.

As part of this, we are looking for support in both our bid for the intangible assets of Mt. Gox as well as the relaunch of the business.

Is Gox Rising planning to form its own Creditor Committee?

Gox Rising is not planning to form its own Creditor Committee but rather support a coalition of all Creditors to form around a merger of interest among the existing groups of Creditors.

What are Forks? And why are they an issue?

Bitcoin has forked many times in the years since the Mt Gox Bankruptcy resulting in new coins that may be of value to Creditors of the Estate.

Are there other hurdles?

Based on the history of this bankruptcy and recent news regarding the Coinlab lawsuit it is fair to say there remain many hurdles known and unknown at this time.

What are Zombie Claims?

Zombie claims, or Ghost claims, are creditors who did not file claims by the filing deadline. It will be determined by the court if some assets are set aside for these creditors in the event they later file claims seeking compensation.

Non-Creditor Interests

Who is Coinlab? What is their claim?

Coinlab and MTGOX signed an agreement for Coinlab to be the exclusive partner of MTGOX in USA, but breached the agreement before their partnership could fully start. Coinlab is now claiming $16B worth of damages from the MTGOX bankruptcy estate, which has so far been denied by the bankruptcy trustee and Tokyo court.

Who is Tibanne?

Tibanne K.K. was Mark Karpeles’s original company in Japan, named after his cat, incorporated together with Jed McCaleb.

Who is Mark Karpeles?

Mark Karpeles tookover MTGOX from Jed McCaleb in mid 2011 and ran the exchange as its CEO and only Director until its closing in 2014. Mark is currently on trial in Japan for falsifying electronic records related to the MTGOX bankruptcy, but has been assisting creditors throughout the bankruptcy process.

Who is Jed McCaleb?

Jed McCaleb is the original founder of MTGOX. He sold the MTGOX to Mark Karpeles’s company by a revenue share agreement in mid 2011.

What are the Missing Coins?

There were multiple thefts over multiple years, totaling about 864,000 BTC stolen. The largest hack was about 650,000 BTC stolen from the mtgox hot wallet slowly over time beginning on September 11, 2011.

What are the chances that some of the Missing Coins will ever be recovered? Why try?

It may be impossible to recover any of the stolen Bitcoins, as they were laundered years ago on BTC-E and circulated to random exchange customers.

Who will control the Foundation?

Mt Gox Creditors will control the Foundation.

Will Brock Pierce or anyone that is part of the management of Gox Rising be a part of the Foundation’s management, board or group of consultants?

No.

Will Gox Rising have any influence over the Recovery Foundation?

No.

How will Gox Rising interact with the Recovery Foundation?

The Foundation will remain fully independent of Gox Rising and will interact with all parties to fulfill the goals of the Foundation and its governing body.

Will the Recovery Foundation issue a new coin?

The Recovery Foundation charter will set forth the purpose of the Foundation and its strategic goals. The issuance of a coin by the Foundation is a possibility.

We will continually be updating the content here so please check back often and do let us know what you feel is missing by sending an email to hello@goxrising.com or fill out the form belaow.

Join the Gox Rising movement for recovery.

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CONTACT

Creditor Support

creditors@goxrising.com