The world’s largest cryptocurrency Bitcoin (BTC) has tanked under $56,000 hitting a one-month low and possibly its worst weekly performance in over six months. As of press time, Bitcoin is trading 6.38% down at $56,104 with a market cap of $1,060 billion.
Now, there have been growing concerns that the creditors of the defunct crypto exchange Mt. Gox might be liquidating their payments. The six-year-long rehabilitation plan to refund the creditors of Mt. Gox has come to its final stage. Earlier this week on November 16, Mt. Gox trustee Nobuaki Kobayashi said that the rehab plan is now “final and bidding”.
Matthew Dibb, chief operating officer at Singapore-based crypto asset manager Stack Funds Told Reuters that there have been profit-taking concerns among investors with the Tokyo Court signing off on the plans to repay the creditors. The expectations are that these creditors will likely turn sellers. Dibb added:
“Selling pressure has been quite constant. “Those affected will receive a large sum of bitcoin, likely happening in Q1 or Q2 of 2022. This has brought some fear into the market on a longer term horizon”.
Is It Really That Big A Concern?
The Mt. Gox exchange which once controlled 70% of the global Bitcoin trading volumes went defunct back in 2014. The exchange lost a total of 850,000 Bitcoins of which 200,000 have been recovered.
Now the Mt. Gox chapter is coming to an end with the trustee Kobayashi saying that the creditors who filed for the claim will get their BTC “fairly quick”. However, there’s been no timeline to this yet whether if this shall happen in the next few weeks or months. Also, it is not clear whether if the payout will happen in BTC or USD.
Crypto analyst Lark Davis explains that even if the payout is in Bitcoin, the selling volume will be minimal. He further explains:
Daily volume for BTC now is 10X what it was at the peak mania phase of 2017. We can easily absorb a couple billion of sell pressure spread out over a few months. If this is what happens then mt gox BTC release will be a big fat nothing burger!!!
Next few months could be interesting for the crypto market as investors remain on the edge.