Mt Gox News: Bitcoin Cash Takes the Spotlight, Says Analyst

Mt Gox News: Bitcoin Cash is the Real Threat, Analyst Claims

Mt Gox News: Fears that bankruptcy redemptions from the Mt. Gox estate will heavily impact Bitcoin’s (BTC) price are misplaced, according to Presto Labs’ Head of Research. However, Bitcoin Cash (BCH) could face a bearish scenario.

Bitcoin Price Dips Amid Market Volatility

As the trading day began in Asia, Bitcoin’s price fell below $60,000, with over $200 million in liquidations reported by CoinDesk. This drop comes as Mt. Gox prepares to return approximately $9.5 billion in BTC and 143,000 BCH worth around $73 million to its customers.

Significant Selling Pressure for Bitcoin Cash

Presto Labs’ analysis reveals that BCH will experience substantial selling pressure, equating to 24% of its daily trading volume, compared to just 6% for BTC. Peter Chung, Presto Labs’ Head of Research, noted that BCH’s daily trading value is only 1/50th of BTC’s, highlighting the potential impact.

Limited Selling Pressure for Bitcoin

In an interview with CoinDesk, Chung explained that BTC is expected to face limited selling pressure since many creditors who wanted to exit have already sold their claims on bankruptcy markets. During FTX’s early bankruptcy days, traders with pessimistic views quickly sold their claims.

Long-Term BTC Holders Expected to Retain Positions

Chung emphasized that weak-handed creditors had ample opportunities to exit over the past decade, leaving a group of strong BTC holders, or “diamond-handed BTC bulls,” as the current creditors.

Bitcoin Cash Treated as Airdrop

Chung predicts that creditors will treat BCH as an airdrop and sell it immediately, given its fork occurred three years after Mt. Gox’s bankruptcy. “Creditors are oblivious to BCH’s cause,” Chung added.

Market-Neutral Trading Strategies Suggested

To mitigate risks, Chung suggests long BTC perpetuals paired with short BCH perpetuals as an efficient market-neutral strategy. Other approaches include shorting term futures or borrowing BCH in the spot market to lock in funding rates.

Mt. Gox’s Bitcoin Cash Redemptions May Hit Hard

Analysts Debunk Bitcoin Fears, Highlight Bitcoin Cash Risks

Concerns that Mt. Gox’s bankruptcy redemptions will drive down Bitcoin (BTC) prices are largely unfounded, but Bitcoin Cash (BCH) may not be so lucky, according to a note from Presto Labs’ Head of Research.

Bitcoin Price Under Pressure Amidst Market Turbulence

As Thursday’s trading day began in Asia, Bitcoin’s price slipped below $60,000, with CoinDesk reporting over $200 million in liquidations. This downturn coincides with Mt. Gox’s plan to return $9.5 billion in BTC and 143,000 BCH worth about $73 million to its creditors.

Disproportionate Selling Pressure on Bitcoin Cash

Research from Presto Labs indicates that BCH will face significant selling pressure, accounting for 24% of its daily trading volume, compared to just 6% for BTC. Peter Chung, Head of Research at Presto Labs, pointed out that BCH’s daily trading volume is merely 1/50th of BTC’s, intensifying the potential impact.

Bitcoin Holders Less Likely to Sell

Chung noted in a CoinDesk interview that BTC is expected to see limited selling, as those wanting to sell have likely already done so via bankruptcy claim markets. This was a common practice during the early stages of FTX’s bankruptcy.

Remaining Creditors are Strong BTC Supporters

According to Chung, weak-handed creditors had numerous opportunities to sell over the past decade, resulting in a remaining pool of strong BTC supporters, or “diamond-handed BTC bulls.”

Bitcoin Cash Seen as an Unrelated Airdrop

Chung expects creditors to treat BCH as an unrelated airdrop and sell it quickly, given that the BCH fork occurred three years after Mt. Gox’s bankruptcy. “Creditors are oblivious to BCH’s cause,” he remarked.

Strategic Trading Recommendations

To address this, Chung advises market-neutral strategies like long BTC perpetuals paired with short BCH perpetuals. Alternatively, shorting term futures or borrowing BCH in the spot market can help lock in funding rates.

By breaking down the information and presenting it in a more engaging and accessible manner, these rewritten headlines and summaries aim to provide clarity and insight into the complex situation surrounding Mt. Gox’s bankruptcy redemptions and their potential market impacts.

Mt. Gox Bankruptcy Redemption: FAQ

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