Mt.Gox Creditor CoinLab Opposes Bitcoin Exchange Resuscitation Plan

CoinLab filed an objection to Sunlot Holdings plan to revive the collapsed bitcoin exchange Mt.Gox.

CoinLab, a U.S. venture-backed company dedicated to making digital currencies more accessible, plans to revive the collapsed bitcoin exchange Mt.Gox. Photo: Mt.Gox

CoinLab, a U.S. venture-backed company dedicated to making digital currencies more accessible, plans to revive the collapsed bitcoin exchange Mt.Gox. Photo: Mt.Gox

CoinLab, the company that formerly managed Mt.Gox operations in Canada and the US, filed an objection to the plan to revive the collapsed bitcoin exchange. The plan was applied by Sunlot Holdings, an investor group that include Matthew Roszak, John Betts and a board member-elect of Bitcoin Foundation Brock Pierce.

CoinLab, the digital currency company based in Seattle, concluded an agreement with Mt.Gox in 2012. Under the deal, CoinLab had to control bitcoin sale, purchase and exchange operations for its investors in North America and Mexico.

The firm then filed a lawsuit against Mt.Gox as the Tokyo exchange was not provided with enough resources to fulfill the agreement. Mt.Gox later countersued the lawsuits that are not settled yet.

The complaint included that proposal by Sunlot Holdings does not take the claims of other unsecured creditors, involving CoinLab, and additional consideration will be needed before anything is approved.

The objection reads: “In an attempt to obtain approval of the Sunlot Proposal, Sunlot has crafted a procedural maneuver that attempts to cram down the proposal upon creditors, while avoiding competitive bidding or other meaningful creditor safeguards.”

The proposal received preliminary approval by US court on the 8th of May. Under the plan, Sunlot Holdings will buy Mt.Gox for 1 BTC and will provide a 16.5% stake in the exchange for its former users.

CoinLab gave comments on how it ensures that its objection is addressed: “Until it receives full assurances that its rights and defenses will be protected, CoinLab is compelled to seek to protect its interests now, before the flawed Sunlot Proposal (and procedural evasion) can gain an unfair advantage.”

CoinLab noted that since its contract to serve Mt.Gox clients is in force and that it had previously worked with the exchange, it is suited to continue handling Mt.Gox operations.

“CoinLab offers a market efficiency to creditors because it can address disposition of its intellectual property rights in the exchange as well as market expertise. However, no process currently exists for competing overbids.”

Lawyers representing the international class actions, fired back at CoinLab: “CoinLab is factually and legally wrong and seems only to trying to influence the orderly procedures of both the Class Action Litigation and the Japanese court system. CoinLab seems to be doing this because it views itself as a competitor to Sunlot and wants to bid.”

As seen, CoinLab doesn’t want Sunlot Holdings to be involved with Mt. Gox, and Sunlot Holdings doesn’t want CoinLab to be involved, either.

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