Bitcoin Cash

2024

Galaxy

Bitcoin

Mt Gox plans to repay about $9 billion owed to creditors. Analysts claim that the reimbursement may not affect the price of Bitcoin, but it could lead to the depreciation of Bitcoin Cash (BCH). Tony Sycamore, an IG Markets financial analyst, said that many historical aspects must be considered when predicting the impact of Mt Gox’s repayment. 
Also read: <a href="https://www.cryptopolitan.com/adam-back-addresses-mt-gox-repayment/">Blockstream CEO Adam Back addresses Mt. Gox repayment concerns</a> 
Mt Gox, a Japanese crypto exchange, was hacked in February 2014, leading to its collapse. The firm lost nearly 940,000 BTC, equivalent to $64 million, at the time of its collapse. However, it managed to recover 141,687 BTC, worth $8.5 billion, as of the time of writing this post. Mt Gox intends to pay $8.5 billion to the creditors who had invested in the now-defunct exchange in July. 
<h2 id="span-style-font-weight-400-sell-pressure-has-already-impacted-the-current-market-span">Sell pressure has already impacted the current market</h2> 
In spite of the anticipated flood of BTC in the market, Tony Sycamore, a financial analyst believes that sell pressure coming from Mt Gox’s repayment has already impacted the current market conditions.&nbsp; Sycamore explained to Cointelegraph that the upcoming repayments would happen against the backdrop of worsening market sentiment, outflows from the Bitcoin ETFs, and technical selling. He also added that much of the crypto’s speculative “hot money” had left to seek “greener pastures” in the equities market. 
The analyst revealed that he’s not convinced the ongoing sell-off can plunge too deep. He cited the strong support experienced on the 200-day moving average as the main reason for optimism in the next few weeks.&nbsp;Sycamore added, “I suspect it probably offers a pretty good entry point for people that have been holding on for better buying levels.” 
Alex Thorn, the head of research at Galaxy Digital, approximated that only 65,000 of the 141,000 Bitcoins will hit the market at once, minimizing much of the anticipated selling activity. 
<blockquote class="twitter-tweet" data-width="550" data-dnt="true"> 
 creditors have been stuck in mt gox bankruptcy for 10+ yrs–finally trustee says in-kind distribution of <a href="https://twitter.com/hashtag/BTC?src=hash&amp;ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">#BTC</a> <a href="https://twitter.com/hashtag/BCH?src=hash&amp;ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">#BCH</a> will begin in july. we think fewer coins will be distributed than people think &amp; that it will cause less <a href="https://twitter.com/hashtag/bitcoin?src=hash&amp;ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">#bitcoin</a> sell pressure than market expects 
 here's why 👇 
 — Alex Thorn (@intangiblecoins) <a href="https://twitter.com/intangiblecoins/status/1805244957252284916?ref_src=twsrc%5Etfw" rel="nofollow noopener" target="_blank">June 24, 2024</a>
</blockquote> 
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script> 
Thorn argued that roughly 75% of the repayment beneficiaries have opted to get an “early” payout, which deducts 10% of their expected repayment. The early payout resulted in nearly 96,000 Bitcoin finding its way to the market initially. 
Thorn explained that Mt Gox owed roughly 10,000 Bitcoin and 20,000 BTC to Bitcoinica BK and claims funds, respectively, leaving only 65,000 BTC to go to the creditors. 
<figure id="attachment_546648" aria-describedby="caption-attachment-546648" style="width: 100%" class="wp-caption alignnone">
 <img loading="lazy" decoding="async" class="wp-image-546648 size-full" src="https://www.cryptopolitan.com/wp-content/uploads/2024/06/Mt-Gox-Bitcoin-repayments.jpg" alt="Mt Gox Bitcoin repayments effects" width="512" height="294" srcset="https://www.cryptopolitan.com/wp-content/uploads/2024/06/Mt-Gox-Bitcoin-repayments.jpg 512w, https://www.cryptopolitan.com/wp-content/uploads/2024/06/Mt-Gox-Bitcoin-repayments-300x172.jpg 300w" sizes="(max-width: 512px) 100vw, 512px">
 <figcaption id="caption-attachment-546648" class="wp-caption-text">
 Mt Gox’s estimated distributions. Source: Galaxy Research
 </figcaption>
</figure> 
<h2 id="span-style-font-weight-400-mt-gox-s-regular-creditors-are-more-likely-to-hodl-span">Mt Gox’s regular creditors are more likely to HODL&nbsp;</h2> 
Thorn further revealed several reasons for concluding that individual Mt Gox creditors may be more “diamond-handed” than anticipated. According to Thorn, most of the Bitcoin creditors were enticed into being “long-term Bitcoiners” so that they would hold their share. Thorn revealed that many creditors had resisted numerous attractive and aggressive offers from claims that wanted to pay in USD, proposing they wanted their BTC back instead of fiat.&nbsp; 
Also read: <a href="https://www.cryptopolitan.com/trump-bitcoin-lightning-network-payments/">Trump accepts Bitcoin Lightning Network payments for donations</a> 
Thorn also pointed to the effect of the capital gains tax imposed on the sellers, claiming that while the main creditors get only a 15% in-kind recovery, most of the claim holders have attained a 140x gain from the time the court proceedings recovered their BTC. 
Thorn remarked that the potential selling pressure on BCH may be worse because most investors did not actually buy Bitcoin Cash outright. They are only getting it because of the <a href="https://www.investopedia.com/terms/h/hard-fork.asp" rel="nofollow noopener" target="_blank">hard fork</a> of BTC that happened in 2017. 
&nbsp; 
Cryptopolitan reporting by Collins J. Okoth

Mt Gox repayments to creditors may not affect Bitcoin as expected

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