Mt. Gox moved $9.6 billion bitcoin to a new wallet earlier this week, but onchain analysts aren’t concerned about these coins flooding the market anytime soon.
Posted May 30, 2024 at 2:03 am EST.
Bankrupt crypto exchange Mt. Gox moved billions of dollars worth of bitcoin for the first time in five years, briefly spooking markets about imminent sell pressure.
On May 28, a cold wallet tied to the exchange transferred a total of $9.6 billion worth of bitcoin to a new wallet address, suggesting that Trustee in charge of paying back creditors was gearing up to begin distributing funds.
Onchain analysts at CryptoQuant have now found that there is no real reason to be concerned about any kind of major selloff associated with these coins.
“We conclude that there is no immediate selling pressure for Bitcoin from these movements as the transfers have occurred within the addresses of the same entity (Mt. Gox Rehabilitation Trustee) and are not still available to the open market,” said the CryptoQuant onchain analysts in a report on Wednesday.
The analysts traced the funds and found that the entire balance of bitcoin held in the wallet was transferred to a single new address, after which it was sent to three different addresses, which each hold 47,300 BTC.
The bitcoin transferred to these addresses, however, is still in the possession of Mt. Gox’s Rehabilitation Trustee, in charge of managing creditor repayments. This was confirmed by a notice issued by the Trustee’s office on May 28, stating that he had neither made any repayments or sold any assets.
The final deadline for Mt. Gox creditors to be repaid is October 31, 2024, but the date the Trustee will begin making repayments still remains unclear. Considering these creditors have not had access to their coins since Mt. Gox filed for bankruptcy in 2014, it is fair to assume that a vast majority of creditors will look to sell their bitcoin.
Still, some market participants are more optimistic that the market dynamics will be different this time, and the market will be able to absorb a significantly higher amount of sell pressure.
“The people receiving these coins are OGs who bought them at <200$. It is, therefore, safe to say they‘ll hodl at least 75% of their coins,” said pseudonymous crypto trader “@Killianz88” on X.
“Meanwhile, the bitcoin ETFs are currently scooping up about 4,000 coins PER DAY. Meaning the Mt Gox coins will EASILY be scooped up on the first day of every week.”
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