As the cryptocurrency community engages in discussions about the forthcoming Bitcoin halving in 2024, there is another significant market event looming this year.
Mt. Gox Repayment Date: Is Bitcoin Facing Turmoil?
Mt. Gox, the hacked Bitcoin exchange, is on track to repay its creditors by the end of October 2023, according to the trustee overseeing the process. This development has the potential to greatly impact the cryptocurrency market in various ways, as acknowledged by industry observers.
Established in 2010, Mt. Gox was once the largest Bitcoin exchange globally, facilitating around 70% of all BTC transactions before its collapse. In 2014, the exchange suffered a devastating security breach resulting in the loss of 850,000 BTC, which accounted for approximately 4% of the total Bitcoin supply. The Mt. Gox incident remains one of the most significant cryptocurrency bankruptcies to date, with creditors still awaiting repayment nearly nine years later. With the current repayment deadline set to take place in approximately three months, Cointelegraph has sought insights from several crypto executives to shed light on what can be expected from the impending Mt. Gox repayment.
It’s a simple question of, what will the investors do? Over the last year, we’ve seen more sales than buys, and many of those who lost on Mt. Gox have moved on past crypto. The chances they hold for more years, after everything that happened, is highly unlikely.
WhaleWire CEO
How Much Will be Repaid?
By the end of October, Mt. Gox aims to repay more than 10,000 creditors worldwide, despite having lost 850,000 BTC in the hacking incident. Due to the limited funds that could be recovered, the exchange will only be able to reimburse a portion of the total losses.
Reports indicate that Mt. Gox plans to repay creditors with 142,000 BTC (equivalent to $4.3 billion) and 143,000 Bitcoin Cash (BCH) coins (valued at around $40 million). Additionally, a sum of 69 billion Japanese yen ($510 million) will be disbursed. The repayments will be made using a combination of fiat currency and cryptocurrencies, with each investor’s payout being individually coordinated.
The repayment of Mt. Gox funds is expected to be a significant event, according to Frank Weert, co-founder of Whale Alert. However, the impact on the market will depend on the manner in which the funds are released and how the media portrays the situation. Weert believes that while some creditors may choose to cash out, it is unlikely to result in a massive sell-off. When asked if the crypto industry has witnessed a similar event, Weert noted that an event of this magnitude has not been seen thus far.
So this is certainly something the market can absorb in a relatively short time frame. I would assume there may be some sell pressure due to the speculation around this event. Many people don’t know basic math.
Mt. Gox
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