The impending Mt. Gox Bitcoin distributions have been looming over the crypto market since the order was granted to begin repaying creditors. Given the massive amount of BTC in the Mt. Gox treasury, expectations are that the distribution will put immense selling pressure on the asset. Now that the coins are starting to move, the crypto market is already responding, despite the repayments not actually starting yet.
Mt. Gox Moves 47,229 BTC To Unknown Wallet
In the early hours of Tuesday, the Mt. Gox Bitcoin wallet carried out a notable transaction that sent ripples through the crypto community. The transaction, which was reported by the on-chain data tracking and aggregation website, Arkham Intelligence, was carrying approximately 47,229 BTC.
A number of initial transactions had originated from a Bitcoin wallet marked as “Mt. Gox” to another wallet marked as the “Mt. Gox: Cold Wallet.” In total, 47,229 BTC was sent to the cold wallet. However, as soon as the coins arrived, they were moved out of the cold wallet to another unidentified wallet.
The value of the BTC coins at the time of the move was approximately $3 billion. To put this in perspective, it is roughly the same amount of Bitcoin sold by the German government over the last few weeks, which sent the Bitcoin price and the crypto market plunging.
Given the volume of BTC, expectations are that if the coins were to hit the market, it would cause a similar decline to what was seen with the German government’s selling spree. In that case, the BTC price could return to the $50,000 territory once again.
Interestingly, this transaction only makes up about one-third of the total amount Mt. Gox is expected to repay to creditors. The bankrupt exchange had previously moved 47,000 BTC, which did not have much of an effect on the market. Around 150,000 BTC are expected to be paid to creditors, worth $9 billion. So, if the total Mt. Gox BTC stash were to hit the market, it could trigger a massive crash.
Bitcoin Price Reacts To The Move
Following the Mt. Gox Bitcoin move, assets in the crypto market have reacted negatively, falling rapidly in response. For example, the BTC price fell from above $64,000 to less than $63,000 in less than one hour, taking the rest of the market down with it.
There has also been a spike in the Bitcoin daily trading volume, rising 44% to over $38 billion. This suggests increased activity among investors, and since the price is falling, it suggests that investors are selling rather than buying BTC at this point.
Featured image created with Dall.E, chart from Tradingview.com
