Mt. Gox Bitcoin pay-out fears leave Crypto market poorer by over $170 bn
Cyrpto market Friday July 05, 2024 lost over $170 billion amid the reports that the trustee overseeing the Mt. Gox bankruptcy has announced the commencement of Bitcoin and Bitcoin Cash repayments to creditors affected by the infamous hack resulting in losses worth billions
Cyrpto market Friday July 05, 2024 lost over $170 billion amid the reports that the trustee overseeing the Mt. Gox bankruptcy has announced the commencement of Bitcoin and Bitcoin Cash repayments to creditors affected by the infamous hack resulting in losses worth billions.
The leading Cryptocurrency, Bitcoin, alone retraced over 20% from its highs in June and May, dropping as low as $53,500.
Altogether, the entire Cryptocurrency market shed over $170 billion in combined market capitalization in 24 hours Friday, according to CoinGecko data.
The massive slide in the Cryptocurrency started Friday after the Trustee for the Mt. Gox bankruptcy estate, Nobuaki Kobayashi, in a statement said that it had begun making repayments in Bitcoin and Bitcoin cash to some of the creditors through a number of designated crypto exchanges, according to CNBC.
Mt. Gox’s trustee didn’t specify how much money had been transferred to these exchanges.
He noted that the remaining funds would be returned to creditors once a series of conditions is met, including confirming the validity of registered accounts and completing discussions between the trustee and the designated crypto exchanges.
The trustee is still working to ensure repayments “can be made safely and securely,” Kobayashi wrote, urging “eligible rehabilitation creditors to wait for a while.”
The crisis is reported after a small amount of Bitcoin was moved out of wallets associated with Mt. Gox, according to blockchain analytics firm Arkham Intelligence, with the largest movement being a $24 transfer to the Japanese crypto exchange Bitbank.
Bitbank is among the recipients listed to support repayments.
Of late, the world’s largest cryptocurrency has been pressured by news of collapsed bitcoin exchange Mt. Gox preparing the distribution of around $9 billion worth of coins to users.
This dumping of coins onto the market is expected to lead to some significant selling action.
Mt. Gox was one of the early and largest Bitcoin exchanges before it went bankrupt in early 2014 after losing 850,000 Bitcoins, worth around $450 mn at the time. The exchange claimed the loss was due to hacking, although there were suspicions of mismanagement and fraud.
Mt. Gox pay-out is not the only reason why the Cryptocurrency market is in red. There are reports that German authorities are preparing to sell some of the 50,000 Bitcoin they seized earlier from online criminals.
Bitcoin miners, meanwhile, are under pressure to unload tokens to cope with evaporating profitability, according to Bloomberg.
[Featured image generated by AI and used for representation.]
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