Fortress sets aside $100 million to make early payouts for Mt. Gox creditors

Mar 20, 2021 | The Block News | 0 comments

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Fortress Investment Group is offering creditors of infamous defunct crypto exchange Mt. Gox an early payout ahead of a vote on a proposal that could remunerate them in mid-2022. 

As per a letter obtained by The Block, the investment firm—which is known for its investments in private equity and stocks—is willing to pay up to 80% of what creditors are owed. Creditors, which have been waiting on a pay-out for years after Mt. Gox shuttered in 2014, could also receive 90% of the value of their claim under a proposal overseen by the trust managing the defunct exchange’s liabilities.

Still, Fortress estimates payments under that proposal—which will be voted on in October—may not be issued until 2022. Here’s a passage of the letter, which was penned by Fortress managing director Michael Hourigan:

“The Mt Gox Trustee recent published a Civil Rehabilitation plan which may allow creditors to receive a payout in mid-2022,” Hourigan wrote. “Our attorney’s estimate that this distribution would occur in mid-2022.”

“Rather than waiting another 1 to 1.5 years, we are offering a liquidity option for creditors who want to receive cash or BTC now,” Hourigan said. 

The firm has set aside $100 million to purchase these claims, betting that Mt Gox’s thousands of creditors would prefer a payout on the coins they’re owed now at a slight discount.

Payouts by Fortress are based off a calculator built by Kim Nilsson to help Mt Gox creditors estimate their mid-2022 payment.

© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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