US lawyers not convinced with MtGox wallet discovery

US lawyers not convinced with MtGox wallet discovery

US lawyers not convinced with MtGox wallet discovery


Tokyo-based now-defunct exchange MtGox announced yesterday that it has found an old format Bitcoin wallet containing 200,000 Bitcoins ($111 million at press time) presumably lost due to a security flaw in their software. This amounts to roughly 23 percent of total Bitcoins reportedly lost.


However, Chris Dore, a partner at Edelson law firm who is representing clients in a class action against the bankrupt exchange does not buy MtGox’s story. His law firm is currently investigating the sequence of events up to the collapse of MtGox, and Dore indicated that the announcement is closely tied to his investigation of the 180,000 Bitcoin transaction that was noticed on the blockchain . He believes that the announcement is merely an attempt to make it harder for information to be uncovered about the funds.


MtGox stated that they have discovered the funds on March 7th and promptly informed the authorities of the recovery. Dore said that, “their statement that they found (these bitcoins) in a random wallet and failed to tell anyone for two weeks is highly suspect.” He added, “If it’s a coincidence, it’s a $120m coincidence. We frankly just don’t buy it.”


Edelson has applied to the courts yesterday for restrictions on MtGox assets to be relaxed in order for easier investigation on their transactions and hopefully to be able to discover more funds. Dore explained: “The idea that they found it in a wallet and they were breaking it down into hundreds of thousands of smaller wallets, it raises a lot of questions about their honesty and whether they’re being forthright about what they have.”


It should be noted, however, the investors that have lost funds in the exchange are not treated as creditors from the bankruptcy hearing. MtGox is attempting to shield its US assets until the conclusion of its bankruptcy hearings in Japan. The next court hearing is scheduled to take place on April 1st in Japan.

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