To commemorate the 10th anniversary of the collapse of bitcoin exchange MtGox, Mark Hunter, author of “Ultimate Catastrophe: How MtGox Lost Half a Billion Dollars and Nearly Killed Bitcoin,” tackles the questions that still remain unanswered ten years later.
Expert Calms Mt. Gox Bitcoin Liquidation Worries, Says “Creditors Aren’t Likely To Sell Soon”
The ongoing saga of the Mt. Gox exchange casts a shadow over the Bitcoin community, even years after its dramatic collapse. Recent developments have stirred the pot again, with Mt. Gox reaching out to former users to confirm ownership of accounts linked to Bitcoin payments.
This move comes amid ongoing efforts to compensate creditors, primarily in Japanese yen, through their PayPal accounts. With the repayment process expected to continue this year, the crypto community remains on edge regarding the implications of releasing Mt. Gox’s substantial Bitcoin holdings, amounting to 142,000 BTC and 143,000 BCH, in addition to 69 billion yen.
Expert Optimistic Take On Gox Coin Release
Amid the swirling rumors and speculation, renowned Bitcoin advocate and CEO of Jan3, Samson Mow, has stepped forward to offer his perspective, seeking to alleviate concerns regarding the potential market impact of unlocking “Gox coins.”
Mow believes creditors’ long wait has cultivated resilience to prevent a sudden, mass sell-off of these assets. According to Mow, even if some creditors decide to sell, the market is well-equipped to “absorb” the impact without significant disruption.
Gox coins unlocking isn’t really a factor. Creditors having to force HODL for a decade aren’t likely to sell soon. What about buyers of claims? They may have sought fiat gains initially, but had a front row seat to #Bitcoin NgU and should now be thinking “sell for gains in what?”
— Samson Mow (@Excellion) January 24, 2024
This view was echoed in response to a user named Spoonman on X, who suggested that around half of the creditors might be inclined to sell. Mow confidently stated that such selling would not co-occur, reinforcing his belief that the market can handle the situation smoothly.
Even if some sell, they aren’t going to do it all at once. Market can absorb it all easily regardless.
— Samson Mow (@Excellion) January 24, 2024
Bitcoin Unexpected Reversal
Interestingly, the Bitcoin market has recently shown signs of recovery, defying some analysts’ expectations of a continued downturn. At present, Bitcoin is experiencing a 3% increase over the past 24 hours, with its trading price hovering above $40,000
However, it’s important to note that this uptick follows a significant decline, with Bitcoin down by 5.7% over the past week and over 10% in recent weeks.
This modest recovery contradicts the bearish forecast presented by Bitfinex in their latest Alpha Report, which anticipated further market downturns. Bitfinex analysts pointed out the vulnerability of Bitcoin’s price due to the reduced profitability of short-term holders.
According to the analyst, this group of investors’ potential reaction to the market conditions could lead to critical support levels being tested at around “$38,000 and $36,000,” as per the report.
However, contrary to prediction, Bitcoin has surged slightly far away from these highlighted support zones. For context, the asset currently trades for $40,037 at the time of writing.
Featured image from Unsplash, Chart from TradingView
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 $20,000 Crash If Mt. Gox Customers Commence Bitcoin Sell-Off
About 200,000 BTC presently worth over $7.7 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 $39,909, 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 $20,000. This would be a monumental crash for the pioneer cryptocurrency, bringing prices back to half of their present market value.
Mt. Gox Moves Seemingly Closer to Bitcoin Repayments For 2014 Hack Victims
Some former customers of the crypto exchange have reported receiving an email asking for confirmation of identity and account details on the mtgoxinsolvency subreddit group.
Mt. Gox Appears to Have Started PayPal Repayments Tied to 2014 Bitcoin Hack
Payments through bank accounts are still awaited.
Mt. Gox creditors offered fresh hope with new ‘commencement of repayment’ email
The Mt. Gox trustee announced the redemption of $47 million in trust assets amid social media reports suggesting repayment to creditors could start in 2023.
Blockchain congestion and transaction queues actually deter ‘nefarious actors’: Study
According to the study, a blockchain’s “fullness” is directly related to its security.
Mt. Gox Bitcoin repayment: The day that never comes
Over the last decade, Mt. Gox has repeatedly postponed the plans to reimburse the funds that the crypto exchange had barred its users from withdrawing — effective from Feb 25, 2014.
Mt. Gox Pushes Repayment Deadline by a Year
The defunct crypto exchange has delayed the deadline for repayments to Oct. 31, 2024.
Bitcoin Sees Sudden Boost Amid Mt. Gox Rumors, But QCP Capital Targets $22,000
The cryptocurrency market, notably dominated by Bitcoin, has always been a terrain of speculation and market sentiment. Rumors and speculations have surfaced with Bitcoin’s recent slight uptick in value. Market insiders point towards the potential delay of the Mt. Gox repayments as a key driver.
However, QCP Capital, a crypto trading firm, remains skeptical about a sustained rally and holds a bearish outlook, indicating that global economic factors could play against the cryptocurrency.
Mt. Gox Delay Rumors Fuel Bitcoin Rally
Mt. Gox, the once-dominant Bitcoin exchange that faced a sudden downfall in 2014, is back in the news. With the April deadline for its creditors to submit repayment information having passed, there was an expectation of repayments by the end of October.
But recent rumors suggest a delay in this timeline to 2024. These speculations seem to have significantly influenced Bitcoin’s price dynamics. QCP Capital, in its market analysis, notes:
A large reason we’re seeing for this bounce is rumors of a Mt. Gox delay to 2024.
The trading firm believes many might have taken a short position expecting repayments soon, and any official delay announcement might spur a considerable short squeeze in the market.
However, the very nature of this rally has made experts cautious. Mt. Gox has a sizable cache of assets set for distribution, including 142,000 BTC (worth approximately $3.9 billion), 143,000 BCH, and 69 billion Japanese yen. Such a vast amount entering the market might create unpredictable price movements.
QCP Capital’s Cautionary Stance
Despite the recent price rally, QCP Capital’s forecast for Bitcoin remains bearish. The firm is still eyeing the $22,000 mark for BTC in the forthcoming month. They expect this uptick to be “short-lived,” with global risks looming over the cryptocurrency market in the fourth quarter.
Further dissecting the market movements, QCP mentioned:
The current Wave 2 of our C Wave expanded flat has so far bounced which we expected, but we still need to see the crucial Wave 3 that breaks the local lows for our count to be intact.
A break above $32,000 would invalidate their current assessment, according to the firm. While the imminent Federal Open Market Committee (FOMC) interest rate decision looms large, QCP sees a parallel to the market conditions of 2020, right before the infamous Covid crash.
Although there’s market speculation around a potential volatility squeeze, QCP believes that a pause in rate hikes by the FOMC is the more likely outcome.
But challenges persist, “At the same time, we do not see how Powell can assuredly call an end to this hiking cycle,” the firm adds, pointing to rising inflation and other economic factors. Additionally, concerns about a potential US government shutdown and increasing oil prices add to the economic uncertainty.
In QCP’s assessment, the stock market might witness a downturn without Federal Reserve intervention, potentially dragging Bitcoin with it. The firm concluded:
In such a scenario without Fed easing, equities will likely be down, taking Bitcoin down along with it until the Fed acts.
Featured image from iStock, Chart from TradingView
Mt. Gox repayment date looming: Is Bitcoin in trouble?
As the Mt. Gox repayment deadline scheduled for October approaches, crypto observers expect a major industry event coming up this fall.
US Justice Department charges two men in Mt. Gox hack
The Justice Department claims Alexey Bilyuchenko and Aleksandr Verner took control of a Mt. Gox server and stole 647,000 Bitcoin from the exchange.
Mt. Gox’s Hackers Are 2 Russian Nationals, U.S. DOJ Alleges in Indictment
The U.S. Department of Justice charged Russian nationals Alexey Bilyuchenko and Aleksandr Verner with hacking Mt. Gox in 2011, at the time one of the biggest thefts in the crypto industry.
The Legacy of Mt. Gox: Why Bitcoin’s Greatest Hack Still Matters
The fall of the Japanese exchange in 2014 saw 750,000 bitcoin go missing, putting crypto’s future in doubt. The event reverberates to this day.
Bitcoin price retargets $29K after Mt. Gox panic liquidates $320M
Carnage thanks to a disproved scare over Mt. Gox bitcoins destroys large amounts of BTC open interest and trading positions in hours.
Bitcoin Market Impact From Mt. Gox Repayments Will Be Limited: Matrixport
Not all the stolen bitcoin was recovered, so only a fraction of the original amount held by creditors will be compensated, the report said.
Mt. Gox repayment registrations close: Here’s what’s next
The deadline for repayment registration for those affected by the Mt. Gox hack has closed, with the trustee releasing a statement on the next steps in the process.
Mt. Gox creditor saga: What lessons has the Bitcoin community learned?
The downfall of Mt. Gox continues to highlight the importance of greater transparency and accountability within the cryptocurrency industry.
Mt. Gox registration deadline pushed for another month
Mt. Gox creditors have another month to file for their claims as the registration deadline was pushed back by another month.
Mt. Gox creditors have until March 10 to register and choose repayment method
Creditors have the option of a lump-sum payment, bank remittance, fund transfer service provider, or through a cryptocurrency exchange or custodian.