2022-7-15 20:48 |
Bitcoin worth nearly $3 billion (roughly £2.5 billion) will soon be released to creditors of Mt. Gox, a defunct crypto exchange that bit the dust after a major heist saw the loss of 850,000 bitcoins.
On one hand, the distribution of the 140,000 or so bitcoins is such good news for Mt. Gox creditors. The group has waited for over eight years amid an arduous rehabilitation process, to be reimbursed.
But while the latest correspondence from the rehabilitation trustee did not specify when the payouts would begin, the release of such an enormous amount of BTC portends a scenario where the market faces a potential dump when holders do get paid.
Kiril Nikolov, DeFi Strategy at Nexo, the leading regulated institution for digital assets, told Invezz in emailed comments:
The Bitcoin influx resulting from the Mt Gox release will undoubtedly have an immediate impact on the market. How big it is would depend solely on the decisions of Mt Gox claimholders; in other words — would they sell, borrow against it to benefit from future rises, or hodl. In one of these cases, crypto lending companies like Nexo give users a choice as to when to liquidate their windfall earnings – if ever – on their own terms.
OGs are likely to hold long-termMt. Gox was founded in 2010, and based in Tokyo, Japan. The exchange earned its name as one of the largest Bitcoin platforms in the early years, with trading volumes hitting nearly 70% of the total market at its peak. In all likelihood, people who bought into BTC at the time were believers in the future of the pioneer cryptocurrency – people who the industry has come to refer to as the OGs.
So what would an OG do if they got Bitcoin today, at a market value way above where BTC/USD traded when the exchange shut down in 2014?
According to Nikolov, all the three cases above are likely. But what this group of holders do will reflect on the sentiment across the industry, especially on what the early buyers of Bitcoin think of the cryptocurrency going forward.
The Nexo strategist explained:
Mt Gox holders’ actions would reflect the overall industry sentiment and be particularly indicative of where the OGs stand when it comes to Bitcoin’s price potential. My firm belief is they are more likely than not to hold long-term and borrow against BTC, and therefore, the sales pressure would be limited.”
The post Mt. Gox Bitcoin payout: Expert’s take on what the OGs might do appeared first on Invezz.
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