- Mt. Gox transfers $3.2B Bitcoin in 2 hours, starting creditor repayments.
- Mt. Gox begins $9.6B Bitcoin repayments, causing brief market dip.
- Mt. Gox’s $3.2B Bitcoin withdrawal sparks market frenzy amid repayments.
Mt. Gox, once the world’s largest Bitcoin exchange, has created a market frenzy by initiating a massive Bitcoin withdrawal. On July 23, the exchange transferred $3.2 billion worth of Bitcoin in just two hours. This move is part of the long-awaited repayment process to the exchange’s creditors, following its collapse in 2014 due to a series of hacks.
The Repayment Process
The rehabilitation trustee of Mt. Gox began processing repayments in both Bitcoin and Bitcoin Cash in July 2024. The trustee’s plan involves distributing 141,686 BTC, valued at around $9.6 billion, to roughly 127,000 creditors.
Bitcoin’s price saw a brief dip, indicating that traders were anticipating potential selling pressure from the creditors. However, analysts believe that much of the expected selling activity might already be priced into the current market conditions.
Tony Sycamore, an IG Markets analyst, noted that the current market sentiment has already factored in the Mt. Gox repayments.
Mt. Gox’s Collapse
At its peak, Mt. Gox handled over 70% of all Bitcoin transactions worldwide. However, its downfall began with unnoticed hacks between 2011 and 2014.
The exchange’s collapse in February 2014 shook the crypto world, leading to a prolonged legal and financial struggle to reimburse its users. Despite the market’s initial jitters, some analysts remain optimistic.
Alex Thorn from Galaxy Digital estimated that only a fraction of the total Bitcoin, around 65,000 BTC, will actually hit the market, reducing the anticipated selling pressure. Additionally, many of Mt. Gox’s creditors are long-term Bitcoin holders, likely to retain their assets rather than sell immediately.
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