Will the price of BTC drop as Mt. Gox moves $840M in Bitcoin before paying off creditors?

Mt. Gox, the defunct crypto exchange, is making headlines once again as it distributes the remaining Bitcoin (BTC) to its creditors. In a surprising move, Mt. Gox has transferred a staggering $840 million worth of Bitcoin to an unknown address, potentially impacting the cryptocurrency market.

This transfer marks a significant turning point for Mt. Gox, which has been entangled in a lengthy saga since suffering a devastating hack in 2014. The exchange has been working tirelessly to compensate for the substantial losses incurred during the cyber-attack.

Reports from Arkham Intelligence confirm that Mt. Gox transferred 12,240 BTC to address 1JbezD.KLAPs6, leaving the wallet with 137,892 BTC. Subsequently, additional transfers of 14,050 BTC and 16,589 BTC, totaling approximately $1.14 billion, were made to the same undisclosed address.

Mt. Gox is preparing to distribute 142,000 BTC, 143,000 BCH, and 69 billion Japanese yen to its creditors. These assets will serve as compensation for the significant losses suffered by customers and the exchange itself during the 2014 hack, which resulted in the theft of 750,000 BTC from customer wallets and an additional 100,000 BTC from exchange funds.

The market has responded to these transfers with a slight drop in Bitcoin’s price, slipping below $68,500 from over $70,600. Some speculate that the release of such a large amount of BTC could trigger a sell-off, potentially causing further volatility in Bitcoin’s price. However, others believe that Bitcoin supporters might step in to stabilize the market.

Looking back at Mt. Gox’s history, the exchange was once a dominant player in the Bitcoin exchange landscape, handling 70% of all global transactions. However, its downfall began in 2014 after the devastating cyber-attack, leading to its suspension of trading and eventual bankruptcy. Since then, legal hurdles in Japan have complicated the process of compensating victims, making it a long and challenging journey. These recent transfers mark the first significant movement of assets from Mt. Gox wallets in five years.

With the deadline for distributing BTC and BCH to creditors fast approaching on October 31, 2024, the cryptocurrency market is closely watching how these asset movements will impact Bitcoin’s price and the overall market dynamics. This development signals a new chapter in the Mt. Gox saga, which has left a lasting impact on the cryptocurrency world.