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Mt. Gox bankruptcy investigation extended by Tokyo court till May 9

Mt. Gox bankruptcy investigation extended by Tokyo court till May 9

By Reuters | Updated: 28 March 2014 16:24 IST

A deadline for a court-mandated investigation into why Bitcoin exchange Mt. Gox failed, and whether it should be revived under bankruptcy protection laws, has been extended to May 9, the company said in a brief statement on Friday.

The Tokyo District Court had set a Friday deadline for Nobuaki Kobayashi, a partner at Nagashima Ohno & Tsunematsu, to report on his investigation into the collapse last month of what was once the world's largest Bitcoin exchange.

In seeking the extension, Kobayashi cited the involvement of investigatory agencies as well as the work required to confirm Mt. Gox's financial situation, according to a petition filed to the court. Mt. Gox said on Wednesday it had submitted records and documents to the Tokyo Metropolitan Police as part of its civil rehabilitation application.

Mt. Gox filed for bankruptcy protection in Tokyo on February 28, saying 750,000 Bitcoins belonging to its customers and 100,000 of its own Bitcoins were stolen by hackers who exploited a security flaw in its software. It also said around $27 million were "missing" from its Japanese bank accounts.

It has since said it "found" 200,000 Bitcoins in an old-format online wallet which it had thought was empty, raising creditors' hopes of recovering some of their lost digital wealth.

Mt. Gox has applied to restructure under a procedure similar to Chapter 11 in the United States. But whether the exchange will qualify for that procedure, or be forced into liquidation, will depend on the results of Kobayashi's investigation and the approval of creditors.

© Thomson Reuters 2014

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