CDS Crypto News Crypto News- The Mt. Gox-triggered sell-off in Bitcoin Cash is exacerbated by low liquidity
Crypto News

Crypto News- The Mt. Gox-triggered sell-off in Bitcoin Cash is exacerbated by low liquidity

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Crypto News- The Mt. Gox-Triggered Sell-Off In Bitcoin Cash Is Exacerbated By Low Liquidity

Crypto News- The Mt. Gox-induced downturn in Bitcoin Cash is compounded by inadequate market liquidity

Crypto NewsBitcoin Cash (BCH), a cryptocurrency formed through a 2017 Bitcoin blockchain split, plummeted 20% last week, marking its largest drop since April, as reported by TradingView and CoinDesk.

The sell-off was triggered by the announcement from defunct exchange Mt. Gox regarding the repayment of approximately $9 billion to creditors, including $73 million in BCH, equivalent to 20% of its daily trading volume. This development sparked panic selling among BCH holders, anticipating potential mass liquidations by Mt. Gox creditors, exacerbated by inadequate liquidity across centralized exchanges, according to Paris-based Kaiko.

Crypto News- The Mt. Gox-Triggered Sell-Off In Bitcoin Cash Is Exacerbated By Low Liquidity

Bitcoin Cash (BCH) Faces Steep Decline Amid Mt. Gox Repayments

Kaiko highlighted that in a market with poor liquidity, executing large orders at stable prices becomes challenging, leading to increased price volatility. On July 5, coinciding with Mt. Gox’s repayment announcement, BCH markets on Bybit and Itbit saw slippage rise sharply, indicating worsening liquidity conditions and heightened volatility.

The liquidity issue has been exacerbated since November 2022, following the bankruptcy of FTX exchange and Alameda Research, a major liquidity provider for alternative cryptocurrencies (altcoins). Kaiko noted that the combination of poor liquidity and heightened selling pressure during the Mt. Gox repayments event resulted in significant slippage increases, particularly on Itbit and Bybit exchanges.

FAQs

What caused the sell-off in Bitcoin Cash (BCH) triggered by Mt. Gox?

The sell-off in Bitcoin Cash was primarily triggered by the announcement from Mt. Gox regarding the repayment of approximately $9 billion to creditors, including a substantial amount in BCH tokens.

How did Mt. Gox’s announcement impact Bitcoin Cash?

Mt. Gox’s announcement to begin repaying creditors, including BCH, led to panic selling among holders anticipating mass liquidations. This significantly affected BCH’s price and trading volume.

For the latest in crypto updates, keep tabs on Crypto Data Space.

Crypto News- The Mt. Gox-Triggered Sell-Off In Bitcoin Cash Is Exacerbated By Low Liquidity
Written by
sevval

Şevval has been actively writing since 2022 and is a third-year mathematics student at Ankara University. Her interest in writing is shaped particularly around innovative technologies such as Web3, artificial intelligence, and blockchain. She closely follows developments in these fields and aims to convey complex topics to readers in a clear and engaging manner. She enjoys combining her mathematical knowledge with technology to create content and strives to raise awareness about the digital world of the future.

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