MtGox Opting For Liquidation Instead of Bankruptcy

Yesterday we reported that the embattled MtGox bitcoin exchange was back in the news with its founder Mark Karpeles refusing to appear before a hearing in the US, deciding to stay put in Japan.

The exchange had originally intended on filing for bankruptcy but this morning has announced that it will instead go for a liquidation filing, citing a “lack of realistic rehabilitation plans”, as reported by the Wall Street Journal.

The exchange also noted that it was experiencing difficulties in meeting with its creditors.

For creditors in bankruptcy cases, a switch to liquidation usually means they will recoup less of their investment. But one person close to Mt. Gox said there was still hope a buyer for the exchange could be found, an outcome that could mean creditors receive part of any future earnings.

MtGox is hoping to find a buyer for the exchange with a number of names swirling around the rumor mill, such as Clearstone Venture Partners, a California-based venture capital firm.