A consortium of investors in planning to purchase Mt. Gox, a bankrupt firm that was once the world’s largest bitcoin exchange platform before it collapsed in February, for one bitcoin or around $400, reported Wall Street Journal.
The group, which also include a former child film star Brock Pierce, stated that the price was informed by an “information vacuum” surrounding Mt. Gox lost bitcoins that has made it difficult to assign value on the firm. Other investors include venture capitalists Matthew Roszak and William Quigley. The purchase will have to be approved by a bankruptcy court in Japan.
Mt. Gox filed for bankruptcy last February claiming that hackers had made away with 750,000 bitcoins that belonged to its clients and 100,000 of the company’s own bitcoins after seizing on a security flaw on the company’s software.
The investor group plans to revive the exchange and put aside 50 percent of the transaction fees to compensate clients and creditors over time, based on documents filed with the Japanese bankruptcy court and analyzed by Wall Street Journal. However, the almost-zero valuation of the proposal may be a hurdle in the court.
So far, Mt. Gox announced in March that it had discovered 2000,000 bitcoins which it had earlier considered redundant, filling creditors with hopes that they may recover some of their virtual wealth.
Bitcoin is a digital currency that was launched in 2009 and has rapidly gained status as the most prominent of the various cryptocurrencies. It isn’t backed by central banked, and users create or “mine” bitcoins by using powerful computers. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.
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