Bitcoin

Will Bitcoin Price Bear the Impact of Mt. Gox Refund Plan?

Published

10 months ago

16 June, 2024

Will Bitcoin’s price bear the brunt of Mt. Gox’s repayment plan?

The following is a guest post by Nischal Shetty, co-founder and president of Shardeum.

Mount GoxBitcoin’s dormancy may not be over, but a series of tokens leaving wallets has caught the market’s attention. A total of 137,890 BTC valued at $9.4 billion is assumed to be headed to lenders’ wallets, and this has warranted a mixed set of responses from experts, most of whom are concerned about a potential increase in selling pressure and a subsequent drop in the price of Bitcoin. .

Gox was once the world’s leading Bitcoin exchange before it was hacked in 2014, leading to the loss of over 850,000 BTC. After years of legal battles, Japanese authorities finally approved a rehabilitation plan in 2021, launching a legal procedure known as “civil rehabilitation,” allowing creditors to recover a portion of their lost funds.

The plan came into effect because creditors who lost their funds now receive a share of the remainder. Mt. Gox’s planned repayments to creditors may have played some role in the 4% drop in the price of Bitcoin in the last 24 hours, which the market was able to shake off with an eventual recovery. However, there is concern that these newly released coins will flood the market, leading to a sell-off and lowering the price even further.

In an official statement, Marcos Karpelesformer CEO of Mt. Gox, confirmed that although Bitcoin sales are not happening now, the tokens being transferred from Mt.Gox to a new wallet are part of a larger distribution plan to creditors.

Understanding Long-Term Holders (LTHs) and Short-Term Holders (STHs)

The Bitcoin market can be broadly divided into two categories based on investors’ holding times: Long-Term Holders (LTHs) and Short-Term Holders (STHs).

LTHs: These investors held their Bitcoins for more than 155 days. They are generally considered to be more resolute and less likely to panic during market crises.
HTS: These investors have purchased Bitcoin in the last 155 days. They are typically more reactive to market news and events and may sell more quickly in response to negative sentiment.

LTH Selloff vs. Selloff History

Senior Analyst at CryptoSlate James Van Straten shares a perspective that illuminates the potential of the Mt. Gox cashback event in the market. He shared on his X account how Grayscale Bitcoin Trust and Long Term Holders have sold around 1 million BTC in the last five months.

The market has managed to demonstrate impeccable resilience in absorbing these sales. In comparison, Mt. Gox’s payments to its creditors would be 1/10 of the 1 million BTC sold.

Bitcoin’s recent rally, which reached an all-time high this year ahead of the halving, was strong enough to encourage some long-time holders to sell, as indicated by a decrease in its total supply. Van Straten argues that this recent LTH selloff would decrease the amount of Bitcoin released through refunds from Mt.

Data and market analysis

According to on-chain data, research firm Glassnode reported earlier this year that the number of Bitcoin addresses holding coins for more than 5 years has reached a new low, suggesting that some long-term investors were taking profits. The massive move in BTC has raised concerns that Mt. Gox creditors may decide to sell their recovered coins on exchanges, flooding the market and driving down prices.

This fear is amplified by the fact that the average daily flow of Bitcoin on exchanges has hovered around 2016 levels, suggesting potentially less liquidity to absorb a large sell-off.

But compared to this larger LTH sell-off, the impact of the Mt. Gox refunds may be less impactful for the market. It is important to remember that not all creditors who receive your BTCs will immediately sell their recovered Bitcoins. And the distribution has not yet formally entered into force.

Among lenders, some may choose to hold or buy more, based on their individual investment strategies. While the immediate market reaction may be negative due to short-term investor jitters, the long-term impact of the Mt. Gox refunds could be positive. Increased institutional adoption often follows periods of market consolidation, and the resolution of the Mt. Gox saga could improve investor confidence in the overall health of the Bitcoin ecosystem.

Conclusion

The Mt.Gox saga and its potential impact on the price of Bitcoin highlight some gaps that can be better addressed at this crucial point in the market’s maturity.

While short-term volatility is expected, especially when large amounts of coins are moved, market stability and an increase in liquidity can boost investor confidence and set a safe tone for the long-term implications of Bitcoin’s performance.

Mentioned in this article

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Bitcoin

What to watch for in the markets

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Photo: Andrew Harnik (Getty Images)

After witnessing one of the largest global IT outages on record, affecting the travel, finance and healthcare sectors worldwideThis week is set to see more political drama, events, and earnings reports from tech giants.

Donald Trump’s ‘Lovefest’ Sets Jamie Dimon Up for Consideration for Treasury Secretary Job

Let’s take a look at what awaits us:

Major companies will release their earnings reports

Major tech companies and others will release their earnings reports this week, paving the way for what the second half of 2024 will look like.

Monday

Verizon will report earnings before the start of operations.

Tuesday

Coca-Cola, Comcast and UPS are all set to report earnings before the market opens.
Tesla will report earnings in the morning, while General Motors will report earnings in the evening.
Alphabet and Visa will report results after the market closes.

Wednesday

AT&T will release its report before the market opens.
Ford and Chipotle will report earnings after the market closes.

Thursday

Earnings reports from AstraZeneca, American Airlines and Southwest Airlines will be released before the market opens.

Trump to speak at Bitcoin conference

Presumptive Republican presidential nominee Donald Trump will speak at the next Bitcoin Conference in Nashville, Tennesseewhich is scheduled for July 25-27. While this is the first time a presidential candidate will attend the conference, it has sparked a debate over whether the crypto-friendly Trump will receive support from the crypto community in the upcoming election.

In addition to Trump, independent presidential candidate Robert F. Kennedy Jr. will also discuss crypto during the conference. Crypto advocates such as ARK Investment’s Cathie Wood, MicroStrategy’s Michael Saylor, and whistleblower Edward Snowden are among some prominent names who will be participating in the conference.

Ether ETFs are on the way

New Ether Spot ETFs are set to begin trading on Tuesday, July 23. Much like the spot Bitcoin ETFs, these ETFs will allow investors to buy the second most popular cryptocurrency like stocks. BlackRock, Ark Invest/21Shares, VanEck, Grayscale, Fidelity, Bitwise, Franklin Templeton, and Invesco/Galaxy Digital are all set to offer Ether ETFs. Crypto asset manager Bitwise predict that trading in the Ether ETF will drive the price of Ether higher, potentially surpassing $5,000.

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Bitcoin

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Cryptocurrency’s Biggest Winners and Losers in a Second Trump Presidency

Bitcoin miners and cryptocurrency companies that have been blocked from going public in the U.S. could ultimately be the biggest winners in the digital asset world under a second Donald Trump presidency. Foreign companies at risk of losing market share could end up being the biggest losers.

That’s the view that’s taking hold among market participants and observers in the wake of the former president’s growing embrace of cryptocurrency as his chances of election grow. survey released Thursday by CBS News showed Trump with the majority — 52 percent — of likely voters in his likely November rematch with President Joe Biden.

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Bitcoin

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Bitcoin, Ethereum, Solana and Cryptocurrency Markets Look Ready to ‘Send’ as Stars Align, According to Investor Chris Burniske

Cryptocurrency investor Chris Burniske says Bitcoin (BTC), Ethereum (ETH), Solana (SUN) and the cryptocurrency market in general seem poised for a run.

Former Head of Cryptocurrency at ARK Invest account his 292,200 followers on social media platform X that several catalysts are aligning, suggesting that digital asset markets are on the verge of a bull run.

According to Burniske, a partner at venture capital firm Placeholder, the highly anticipated launch of Ethereum-based exchange-traded funds (ETFs), Republican presidential candidate Donald Trump speaking at an upcoming Bitcoin event, and the current state of the BTC, ETH, and SOL charts all suggest significant optimism for the cryptocurrency markets.

“With ETH ETFs set to go live, Trump speaking at The Bitcoin Conference, and BTC, ETH, and SOL charts looking [they do] (while stocks are weak), it’s hard to imagine a world where we don’t ship next week.”

Reuters recently reported that preliminary approval for ETH ETFs has been granted as the Bitcoin Conference is scheduled to take place from July 25-27.

BTC, ETH, and SOL are trading at $67,333, $3,528, and $174 at the time of writing, respectively.

The venture capitalist too provides an update on his prediction that the total crypto market cap will eventually hit $10 trillion. According to his chart, the path to $10 trillion is currently “23%” complete, as it sits around $2.2 trillion.

Source: Chris BurniskeX

Earlier this month, Burniske he said in an interview with Real Vision CEO Raoul Paul that he has his eye on the Move ecosystem, which was originally built by social media giant Meta and then used to develop layer 1 blockchains Sui (IUE) and Apts (APT).

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Bitcoin

Here’s the next target for BTC before bulls can hold out for $70K

Published

9 months ago

21 July, 2024

SatoshiTimes Staff

Here’s the next target for BTC before bulls can hold out for $70K

Bitcoin’s recovery is going well, and the market is seemingly poised to create a new all-time high in the near term.

Technical analysis

Per NegotiationRage

The daily chart

As the daily chart shows, the price of Bitcoin has been rising since it broke above the 200-day moving average.

The market has also reclaimed the $60K and $65K levels and is moving towards the $68K resistance zone, which could be the last hurdle before creating a new all-time high. With the RSI also indicating that the price has clear bullish momentum, it could be just a matter of time.

Source: TradingView

The 4-hour chart

Looking at the 4-hour chart, it is evident that the price has been rising rapidly since breaking the downtrend line to the upside. The market also broke the $65K resistance level with momentum, turning it into a support.

While almost everything points to a new record high in the coming weeks, there is one worrying sign. The RSI is showing a clear bearish divergence between recent price highs, which could indicate a correction or even a reversal in the near term.

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