Because they still don't know who the legitimate clients are, how much each is due, and therefore how big a slice of the leftovers (including that OKPay amount) each one will get.


There are many people who would like to stop the liquidation and reopen MtGOX, presumably because they have dirty money in there, or don't want the truth about the "theft" to be found.  But the court has already decided that there is no hope to let MtGOX resume and pay all its obligations,  so the liquidation will go on.


The balance in your MtGOX account not your property; it was only a promise by MtGOX that they would send you so many BTC and so many dollars if you chose to withdraw it all.  Unfortunately, the spoils of MtGOX do not cover 1/5 of those promises.   For months, if not years, their clients were trading with coins and dollars that did not exist.

Client preferences and their opinions as to what is the "just" division are usually irrelevant in liquidatons.  The process is usually predefined very tightly so that the liquidator does not have to negotiate with thousands of creditors with different desires and opinions.   

Check how the Bernard Madoff liquidation was handled.  AFAIK the court ignored Madoff's inflated account balances and considered only the investor's deposits minus withdrawals.  I am told that this is the standard rule for liquidations, in the US and in Japan.

IF Kobayashi chooses to rely the final balances, rather than deposits minsu withdrawals, he may choose to distribute what is left of the BTC as BTC.  That has one advantage (saves him the work of auctioning them) but several potential legal problems.

However, to anyone who is not a fanatic bitcoiner, the demand to have the spoils returned as BTC rather than yen sound childish and irritating.  "Do those guys want their wealth back, or do they want to keep on playing their silly bitcoin game even in the court?"


I would be VERY surprised if those accounts will get any consideration.  The court will not deliver anything, yen or BTC, to people that are not fully identified.


If those coins were really stolen, I believe that the stolen amount (500 M USD) is already way more than the largest bank heist/robbery in history.

If it was embezzlement by the MtGOX management or staff, however, I doubt that it will be among the top 10 largest.

This may turn out to be the singular case wherein something different actually happens. The legal system is being forced to deal with bitcoin, and It is very ill-equipped for doing so. More disclosure about the facts of the closure would be most welcome once investigations are complete.

There was a recently published Harvard Law Review article about Silk Road and Mt. Gox. It's conclusion was:

The Japanese can't be blamed if the depositors take the initiative to voluntarily settle with the other creditor(s) (Mizuho Bank?) and the debtor, Mt. Gox. Not sure how this can be accomplished in Japan, yet it's a very common to have "compositions agreements" and "extension agreements" to settle out-of-court a bankruptcy proceeding in the U.S.

After several months, no money and no coins back.

I wonder about how people that bought Gox coins after withdraws have been suspended are feeling now about their "investment"

The above interpretation was not in the spirit of the TOS (nor in the letter, but I don't have all the versions that might have been applicable during the time). If it was, the mere act of sending BTC to Mt.Gox and receiving Goxbux would have been a taxable sale of one type of property and purchase of another (similar as you sell a house and buy one next to it).

This underlines the need for common reason in the action of governments/courts. If they rule something that is clearly contrary to what the people voluntarily have chosen to do, they cause more resentment, and people start to actively ignore government in everything they do, instead of passively.


If the stuff stored is customer property, it is not touched and is just returned.

If it is customer accounts, it is not touched and is just returned.

If it is customer accounts, fraudulently intermixed with company funds, misrepresented, accounts fudged, half stolen, YES the liquidator has a problem with fake entries/claims and many others. Still he should rather make a distribution choice that closer represents the reality than one which is far from it.


Do you silly guys want your bank boxes' contents back? Can't you see the bank was raided and what little was left we openly auctioned to our buddies for the total proceeds of $532.75. This will now be distributed in a random way we choose.

No, I don't mean it's easy. But it is much easier than the bank boxes thing with jewels blown up everywhere and cash and charred documents... They do need to handle those with utmost care also.


According to natural law, if you identify using the same means that originally was the basis of identification, you should be able to have the same rights (or at minimum be required to upgrade your identification to a level acceptable to the court first). Dismissing non-verified ppl out-of-hand goes against everything (as pretty much all that the govts/"justice" system does, unfortunately).

It is starting to look like no class of creditor, whether depositor or otherwise, will benefit very much should this liquidation continue. However, you are quite correct that communication between the various groups will be a real challenge. However, an effective out-of-court settlement of the bankruptcy could be a win-win solution for everyone concerned.

If we use the Kobayashi Maru test as an analogy, wherein Star Fleet cadets are tested on how they handle a no win situation, perhaps depositors would be wise to emulate the example of James T. Kirk instead of that of Mr. Spock. As you may recall, Kirk quietly reprograms the test simulator and comments that he doesn't believe in "no win" situations.  Even though he circumvented the rules, in the end he gets an award for "original thinking". Spock believes only through his own sacrifice can he deal with "no wins". See http://en.wikipedia.org/wiki/Kobayashi_Maru#James_T._Kirk.27s_test

I don't know whether the court will accept that.  However, the source of the deposits noes not prove account ownership.  Consider deposits in yen: what would have prevented person X from sending a bank transfer to MtGOX, to be deposited in the account of person Y?

Moreover, suppose that the real owner Y of the account is someone who cannot claim it because he is a criminal at large, a tax evader, a MtGOX manger, etc..  He could ask his "clean" proxy Y to claim the account, and sign the message himself.  Or even give Y the private key. 

The basic problem here is that knowledge of the private key gives possession of the coins in some address, but does not establish whose property they are.

Imagine that a gold exchange has got only two customers, George who deposited a chunk of gold worth 990'000 dollars, and Dick who deposited only 10'000 dollars, at the same time.  The same day the exchange goes bankrupt, and the liquidator finds only 5'000 dollars worth of gold and 5'000 dollars in cash, that is, 1% of what it was supposed to have.  How will they be split?

If the liquidator were to compute gold and dollar claims separately, Dick would get all the 5'000 dollars (50% of his deposit), while George would get all the gold (about 0.5% of his deposit).

That is why I think that the MtGOX liquidator must convert all claims to yen, so that he can establish the ONE fraction of the assets that each customer should get. EDIT: Not for moral reasons, but to avoid legal claims of unfair division of the spoils.

In the example above, George's claim would be 99% of total claims while Dick's would be 1%, so they would get 9'900$ and 100$, respectively (for both, 1% of their deposit).

Once the MtGOX liquidator has established the fractions, he may let each client choose whether he wants to get his slice of the total assets as BTC or as yen.  But, even in this case, he will have to compute the total worth of the assets using the current JPY/BTC price, irrespective of the criterion used to compute the claim values. But then he will have to administer the conflict between the disparate wishes and the amount of BTC actually remaining.

In the example above, what should the liquidator do if George wanted to get his part in cash (as the law entitles him to) and Dick asked to have his in gold?

I suspect that he will choose to auction the BTC and divide the yen, to avoid that messy situation.

It's a huge win for lawyers and accountants who will profit when the rightful owners of Mt. Gox's bitcoins can't agree on how to settle the matter. The only way to reverse this is for depositors to somehow work together and overturn this liquidation with an out-of-court settlement.

Thanks for pointing out the obvious though--liquidation is a total "no-win" for everyone. Even Spock would agree, liquidation isn't "logical" when there can be a better way.