Will the $3 billion in Bitcoin released by Mt. Gox lead to a market bottom in August?
In 2011, Mt. A Gox hack and the loss of 850,000 bitcoins worth about $ 17.8 billion at today’s prices will soon put 137,000 bitcoins worth about $ 2.8 billion on the market. In 2014, Mt. Gox announced that it had recovered 200,000 bitcoins, but the coins were still locked in litigation. In November 2021, Mt. Gox about 7 years ago announced an official “rehabilitation program” to return lost funds to investors who lost access to their cryptocurrencies. Then, on July 6, 2022, Mt. Gox and “rehabilitation trustee” Nobauaki Kobayashi sent emails to creditors asking for USD, BTC or BCH.
In addition, creditors who have not yet executed it are reluctant to convert their bitcoins into cash because they immediately represent early creditors in the cryptocurrency. With Bitcoin down more than 60% from its all-time high, it’s fair to say that many people who are paid with Bitcoin are more likely to put it into cold storage than sell it. Some bitcoins were sold before the next bitcoin release. In 2018, 24,658 bitcoins (worth $ 260 million at the time) were sold to Kobayashi during a creditors ’meeting. If the release of the rest of the Mt Gox fund has the same effect on the price of Bitcoin, it could fall below $ 10,000. However, even the last few months have seen equal Bitcoin selling pressure from parties like Luna Foundation Guard, Three Arrows Capital and Bitcoin miners.
LFG has sold billions of bitcoins with little impact on bitcoin as the market has absorbed the selling pressure. A change in market confidence and the overall global outlook sent bitcoin prices down in the weeks following the event. The mountain of Gox borrowers may well swallow any sales, but the social awareness of early bitcoiners abandoning their coins can make a severe psychological impression.