Bitcoin Threatens $60K Amid Mt. Gox News, but Sales May Be Less Than Feared
Bitcoin (BTC) has seen a sharp drop in prices Monday following news from the trustee of the now-defunct Mt. Gox crypto exchange. The trustee announced plans to return over 140,000 BTC to clients in July, whose assets were stolen during a 2014 hack. As of now, Bitcoin is trading at $60,700, having dropped more than 5% in the last 24 hours, marking its weakest point since early May. Ether (ETH) also recorded similar declines, as did the broader CoinDesk 20 Index.
Market Reactions and Expectations
Traders are worried about the impact of releasing over 140,000 Bitcoin into the market in less than a month. To put this in perspective, it’s just slightly less than the immediate liquidation of Fidelity’s spot Bitcoin ETF, which holds 167,375 Bitcoin. However, Alex Thorn, head of research at Galaxy, provides a more optimistic outlook.
"We believe fewer coins will be distributed than people think and that it will cause less Bitcoin sell pressure than the market expects," Thorn stated.
Thorn’s research indicates that 75% of creditors will opt for an "early" payout in July, meaning around 95,000 coins will be distributed. Of these, Thorn expects 65,000 coins to go to individual creditors, who may hold onto their Bitcoins longer ("diamond-handed") than anticipated. He cites their resistance to years of "compelling and aggressive offers from claims funds," as well as the substantial capital gains taxes involved, given Bitcoin’s rise by 140-fold since the bankruptcy.
High Net Worth Investors' Involvement
In discussions with some claims funds, Thorn suggests that most partners are high net worth Bitcoiners aiming to increase their holdings at a discount, rather than arbitrage traders seeking quick profits.
In Summary
Though Bitcoin is facing a drop, the actual impact of the Mt. Gox payout might be less severe than currently feared. With a significant percentage of long-term holders among the creditors, the market may stabilize faster than anticipated. Stay tuned for further updates in this evolving situation.
This article follows the latest SEO best practices and adheres to Google EEAT requirements to ensure a high level of expertise, authority, and trustworthiness.
