- Mt. Gox transferred $2.7B in BTC to a new address.
- The transfer has caused panic with fears of massive sell-offs.
As Bitcoin [BTC] reported a two-month low after declining by 11.715 in the last seven days to trade at $54k, a massive sell-off continued to hit the market.
According to Arkham Intelligence, bankrupt Japanese exchange Mt. Gox has transferred $2.7B in Bitcoin to a new address.
Arkham announced the transfer on their official X (formerly Twitter) page, stating,
“Mt Gox moves 47,228 BTC ($2.71 billion dollars) from cold storage to a new wallet.”
Source: X
According to Lookonchain’s post on X, in recent days, Mt. Gox has been preparing to pay its creditors. In the post, they stated,
” The #MtGox wallet transferred out 47,229 $BTC ($2.71B) 30 minutes ago, possibly in preparation for repayment in July.”
Why is Mt. Gox transferring funds?
Mt. Gox was the largest crypto holder in the world before its collapse in 2014, trading over 80% of BTC in USD at the time. However, it filed for bankruptcy following a series of heists that resulted in 950K BTC.
A decade later, it’s preparing $9B worth of BTC to pay the victims of the heists. Therefore, the recent transfer is a glimpse of hope for victims who have spent years waiting for compensation.
Last month, the company announced the completion of all necessary steps to start the repayment after delays and legal battles.
The repayment means that creditors who lost their Bitcoin when it was trading at $600 in 2014 will enjoy the massive value, which has been added after 10 years of steady rise.
Concerns over potential sell-off
Following the reimbursement news, various players have expressed their concerns, arguing that Mt. Gox is dumping, mirroring the same actions taken by Germany days ago.
According to analysts, this is causing panic, resulting in selling pressure, which has pushed BTC prices to decline.
Angeleo shared her concerns on X, arguing that the market is likely to express more price decline, noting,
“The entire market is dumping and will potentially continue to dump as mtgox makes original btc holders whole.”
Undoubtedly, the transfer will increase BTC volume in the market, resulting in inflation. Also, most people receiving the compensation will sell their assets after a long wait.
Such sell-offs would have a considerable negative impact on BTC prices.
Overall market implication
Notably, this negative price action will have an impact on the market as Mt. Gox customers will sell their BTC to benefit from the accumulated gains of the crypto.
Read Bitcoin’s [BTC] Price Prediction 2024-25
With creditors getting their tokens back, crypto prices will come under extreme pressure this month. Adding to the move by Germany to transfer $310M worth of BTC, the market will suffer from the dump.
However, all projections indicate a rebound from August, with these losses being short term and market forces will contain them.