Bitcoin price predictions split as Mt Gox bankruptcy repayments near
Creditors of the defunct Mt Gox cryptocurrency exchange will soon begin the process of recuperating some of their funds, leading to fears among investors that mass liquidations could lead to a bitcoin price slump.
Nine years after the exchange collapsed, Mt Gox customers will finally be able to redeem at least part of their holdings as either fiat or crypto.
The deadline to select a repayment option is 10 March, with repayments expected to begin in September this year.
A 2022 report from Coinjournal described the Mt Gox crash as “the most existential threat to crypto” in its 15-year history.
The Tokyo-based exchange ceased operations in 2014 after roughly 850,000 bitcoins belonging to customers went missing, amounting to around $680 million at the time. 142,000 BTC have since been recovered, worth more than $3.3 billion.
The exchange was handling over 70 per cent of bitcoin trading volume at the time of its collapse, with the amount of bitcoins lost equivalent to around 7 per cent of the entire supply of the cryptocurrency.
The market impact has long been a concern for investors and traders, however a new report from UBS has downplayed fears of any major movements.
“It’s certainly difficult to estimate the extent to which the market has been pricing massive sales coming from Mt Gox,” UBS strategist Ivan Kachkovski wrote.
“However, we think such news could have been an additional factor for – what we believe could be mainly retail-led – BTC’s surprising resilience of late.”
Bitcoin has seen a strong start to 2023 – rising nearly 50 per cent in price since the start of the year – leading to renewed hope that the so-called “crypto winter” may soon be coming to an end.
The return of dormant bitcoins to the market will be a major test of consumer confidence in the cryptocurrency.