After a 10-year wait, Mt Gox bitcoins are finally coming back

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In late February 2014, Daniel was on his computer trading bitcoins on the Tokyo-based crypto exchange Mt. Gox. Suddenly, the website went white and became unresponsive. In a panic, Daniel turned for answers to the internet forum Bitcoin Talk, where speculation had already begun: Mt. Gox was in trouble.

Daniel, who lived in Europe, was a university student at the time. After making a little money trading bitcoin on Mt. Gox, he deposited almost all of his assets in the exchange. Daniel says that when Mt. Gox went offline, he was “in a state of total crisis.” He needed that money to finish his remaining time in school.

On February 28 of that year, Mt. Gox filed for bankruptcy. The company said hundreds of thousands of bitcoins were stolen in a massive theft—worth about $400 million at the time, now worth $45 billion. The company had practically no balance with which to process withdrawals.

Thus began the Kafka-like ordeal for Mt. Gox customers, who have spent the past decade battling a winding and bureaucratic corporate restructuring process in the hopes of recovering their lost bitcoins. WIRED spoke to eight former Mt. Gox customers, all but one of whom, like Daniel, asked to appear under a pseudonym to protect their financial privacy. Each of them told a similar story, characterized by confusion, frequent delays, and a lack of control.

“The first few weeks were the worst,” says Daniel, who went into depression and started drinking during this period. Although he later took out a loan to finish college, Daniel briefly resorted to credit card fraud to recover the stolen money, telling himself that no harm would come to the individual card holders, who were insured. After getting caught, he looked for a steady job, but at that point “I had almost given up on life,” Daniel says.

Ten years later, Mt Gox customers are about to be reunited with their bitcoin. On June 24, the trustee responsible for managing the estate, veteran bankruptcy lawyer Nobuaki Kobayashi, announced that crypto repayments would begin in July. On Friday, the coins began moving.

In a highly unusual turn of events, Mt. Gox’s customers actually stand to benefit financially from their involvement in the bankruptcy. Since only a limited amount of bitcoin was recovered, customers will only receive about 15 percent of the bitcoin they held on the exchange. However, the hundredfold increase in price in the intervening period means that the dollar-value of the coins will be far greater than the value of their original pile. In total, about $9 billion worth of bitcoin will be returned. “I’ve seen the crypto universe grow, die, and grow again,” says Daniel. “I’m watching the bitcoin charts daily.”

Mt.Gox Launched in 2010 by Jed McCaleb, one of the earliest bitcoiners in the US. McCaleb sold the exchange in 2011 to Marc Karpeles, a young French developer, under whom it became the world’s largest exchange. In 2013, three quarters of global bitcoin trades were reportedly going through Mt Gox.

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