The Mt. Gox Rehabilitation Trustee has announced that repayments in bitcoin and bitcoin cash have begun for some creditors. Further repayments will occur once several conditions are met. Mt. Gox has moved significant bitcoin amounts ahead of its planned billion repayment. Bitcoin’s price dropped amid these developments and other market activities. Mt. Gox Begins […]
Bitcoin News
Bitcoin Alert: Mt. Gox Starts Repayments With Small Exchange Transfer
According to data from Arkham Intel, Mt. Gox has initiated the process of repaying creditors by transferring a nominal amount of Bitcoin to one of the designated exchanges. This development follows months of speculation and planning concerning the disbursement of approximately .2 billion in Bitcoin owed to creditors of the defunct exchange.
Are Mt. Gox Bitcoin Repayments Beginning?
Early today, three wallets historically linked to Mt. Gox executed three transactions. The most significant of these involved the transfer of in Bitcoin to a wallet which then proceeded to send these funds to Bitbank’s hot wallet. Bitbank, listed as one of the exchanges authorized to facilitate repayments, alongside Kraken, Bitstamp, SBI VC Trade, and Bitgo, is set to make these funds available to its customers within a timeframe extending up to 90 days from receipt.
However, there is some uncertainty surrounding these transactions, as the funds were not moved directly from the primary Mt. Gox wallets. Observers speculate whether this activity could be a preliminary test ahead of larger transfers intended for creditor repayment. The Mt. Gox Rehabilitation Trustee has previously indicated that the repayment process was scheduled to commence from the beginning of July, although specific dates for the transfers have not been disclosed publicly.
The other two transactions, one transfer of BTC worth .00 and another worth .32, was transferred to a new wallet.
This subtle movement of funds occurs amidst a turbulent period for Bitcoin, which has seen its price plummet by more than 20% since reaching ,000, now hovering around ,700.
What To Expect
Peter Chung, Head of Research at Presto Research, recently provided insights into the broader implications of the Mt. Gox repayments. He outlined the expected dynamics between Bitcoin (BTC) and Bitcoin Cash (BCH), predicting significant trading opportunities.
“The Mt. Gox’s Rehabilitation Trustee plans to distribute multi-billion dollars worth of BTCs and BCHs to the Mt. Gox creditors between July 1st and October 31st, 2024. This will likely alter supply/demand dynamics in BTC and BCH during this four-month period, potentially opening up a pair trading opportunity,” he stated.
Chung emphasized the disparate impacts on BTC and BCH: “Our analysis shows that the selling pressure for BCH will be four times larger than for BTC – i.e., 24% of the daily trading value for BCH vs. 6% of the daily trading value for BTC. This differential reflects varying investor bases, with BCH’s being considerably weaker and more likely to sell off holdings.”
He advised traders on potential strategies: “Long BTC perpetuals paired with short BCH perpetuals is the most efficient market-neutral way to express this view, barring funding rate risk.” For those concerned about volatile funding rates, Chung recommended exploring “other approaches, such as short-term futures or borrowing BCH in the spot market.”
At press time, BTC traded at ,727.
Bitcoin Repayments: Mt Gox Starts Verifying Addresses For 200,000 BTC In Payouts
Defunct Japanese-based cryptocurrency exchange, Mt. Gox has taken the next steps toward its Bitcoin distribution process to customers who were previously affected by its 2014 hack attack. The crypto exchange has delivered mass emails to account holders as they confirm wallet addresses for individuals eligible for its repayment process.
Mt. Gox Prepares For Bitcoin Repayments
Recently, Account holders at Mt. Gox reported in a Reddit post that they have been receiving new emails from the crypto exchange regarding an identity verification and confirmation procedure initiated by the exchange.
Mt. Gox disclosed that it has begun confirming wallet addresses from users who had officially owned accounts at the crypto exchange and had successfully completed their identity verification processes. The crypto exchange also revealed that it would be distributing Bitcoin (BTC) and Bitcoin Cash (BCH) as part of its repayment process to account holders, with the payout ranging from 142,000 BTC to 200,000 BTC.
Furthermore, Mt. Gox disclosed that the rehabilitation trustee has shared customer details with the custodian to facilitate the account verification process. The crypto exchange warned that customers with disabled or frozen accounts may not be eligible for the fund distribution program.
In September 2023, Mt. Gox declared an extension of its repayment deadline from October 2023 to October 31, 2024, attributing the decision to the need for further discussions to ensure proper disbursement of funds. During December 2023, the crypto exchange encountered a slight hiccup in its payment distribution process after it announced it had unintentionally issued double payments to specific users.
Following the error, Mt Gox urgently requested these users to return the excess funds, warning of potential legal consequences and the possibility of being excluded from the reimbursement plan scheduled later this year.
This year marks nearly a decade since Mt. Gox suffered a hack attack resulting in the loss of a substantial 850,000 Bitcoin. Recent developments in the repayment process bring hope to former customers of the crypto exchange who were adversely affected by the cyber theft.
BTC Faces ,000 Crash If Mt. Gox Customers Commence Bitcoin Sell-Off
About 200,000 BTC presently worth over .7 billion, is expected to spread through multiple wallet addresses owned by Mt.Gox creditors. This raises concerns about the potential impact this Bitcoin distribution could have on the crypto market.
Presently, Mt. Gox’s 200,000 BTC repayment amount surpasses the total value of Microstrategy and El Salvador’s Bitcoin holdings, which are among the largest in the world.
With Bitcoin currently at ,909, if Mt.Gox account holders receive their reimbursements and attempt a sell-off to take their profits, which have grown by a substantial 99,900%, the price of Bitcoin may dip below ,000. This would be a monumental crash for the pioneer cryptocurrency, bringing prices back to half of their present market value.
Celsius Beats Down Liquidation Price With $120 Million In Loan Repayments
Celsius has been at the center of most crypto controversies in the last month. The lending platform had had to pause withdrawals, transfers, and swaps on its platform, citing extreme market conditions as the reason, but that was only the beginning of its troubles. However, Celsius looks to be taking it on the chin because contrary to what others have done, the platform has made moves to pay down its debts and has now beaten down its liquidation price by more than 200%.
Celsius Pays 0 Million In Loans
The beginning of the week came with good news for the Celsius lending platform which had been able to put more money towards its loans. Previously, the company had added 7,000 BTC that had brought its liquidation price down to ,582 but remained at risk given the volatile nature of bitcoin. That is why the company has continued to add to its position to beat down the liquidation price to save the platform.
Related Reading | Mounting Support For Bitcoin At ,000 As Market Ushers In A New Week
Over the weekend, it was reported that Celsius had padded up its position once more, and in a series of repayments since July 1st, the lending platform has paid a cumulative 2.8 million. The latest of these payments had been the most prominent with the platform paying million in DAI stablecoin towards its loans. This payment had come hours after another significant repayment of million in DAI stablecoins.
As it stands, Celsius has managed to beat its liquidation price down to ,967, a more comfortable point for the lending protocol and its users who are still hoping to get back their coins that are now stuck on the platform. Celsius’s outstanding loans now sit at million with an overcollaterization ratio above 577%.
CEL token trading at .89 | Source: CELUSD on TradingView.com
Will Users Get Their Coins Back?
Celsius is yet to address users on if they will be getting their funds which are stuck on the platform back. There is a good portion of the market that has considered these coins lost, but with Celsius’ multiple loan repayments, it continues to spark hope in the hearts of investors that they would be able to one day withdraw assets again.
Related Reading | Active Ethereum Addresses Touch 2020 Levels, Will Price Follow?
Users have reported that the lending protocol has continued to pay rewards on their holdings despite not being able to withdraw. Its native token, CEL, had seen a significant run-up after suffering a terrible loss following the announcement of blocked withdrawals.
Its last communique with the public had been through a Medium post where the platform announced that it continues to work towards stabilizing liquidity and restoring operations. The blog post did not contain information about when it will be restoring withdrawal options. However, it did state that it continues “to take important steps to preserve and protect assets and explore options available to us.”
Featured image from Reuters, chart from TradingView.com
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