Bitcoin

Bitcoin Windfall Arrives for Mt. Lenders Gox after 10,000% price increase

Published

10 months ago

29 June, 2024

Users of the failed bitcoin exchange Mt. Gox have been trying to get their money back for a decade. Starting in early July, the company will begin refunding users’ funds.

Kiyoshi Ota | Bloomberg | Getty Images

Mount Gox, the Japanese Bitcoin The exchange that went bankrupt a decade ago after a major hack is finally ready to pay back creditors, who are being handsomely rewarded for their patience.

Up to 950,000 bitcoins were lost in the 2011 hack, at a time when the cryptocurrency was trading for a small fraction of its current value. About 140,000 of these coins have been recovered, an amount that, at today’s prices, means about $9 billion worth of bitcoins will be returned to their owners.

Among the plaintiffs is Gregory Greene, a native of Illinois. Shortly after the exchange declared bankruptcy in February 2014, Greene filed a class action lawsuit against Mt. Gox and his former CEO. Greene said at the time that his frozen account contained $25,000 worth of bitcoin, although he did not disclose the exact number of coins in his wallet.

Bitcoin was trading at approximately $600. Today, it is worth more than $60,000. This suggests that Greene’s lost stock, at current prices, would be worth about $2.5 million, a gain of 10,000%. However, it is unclear how much he will receive in payments, which are expected to begin rolling out in July.

John Glover, chief investment officer at crypto lending firm Ledn, said lenders are in for a historic windfall.

“Many are clearly going to cash out and take advantage of the fact that having their assets trapped in the Mt. Gox bankruptcy was the best investment they ever made,” Glover told CNBC.

Mt. Gox was an online marketplace where people could buy or sell bitcoin using different currencies. At the height of its success, the platform was the largest spot bitcoin exchange in the world, claiming to handle around 80% of all global dollar-to-bitcoin trades.

The company, whose acronym was created from the name “Magic: The Gathering Online Exchange”, closed in February 2014 after a series of robberies.

Mt. Gox blamed the bitcoin disappearance on a bug in the cryptocurrency’s structure. While users were receiving incomplete transaction messages when accessing the exchange, the coins may have actually been illicitly moved out of their accounts by hackers, Mt. Gox said.

On Monday, the court-appointed trustee overseeing the exchange’s bankruptcy proceedings he said Distributions to the company’s roughly 20,000 creditors would begin next month. Disbursements would be made in a mix of bitcoin and bitcoin cash, an early offshoot of the original cryptocurrency.

Alex Thorn, head of research at crypto asset management firm Galaxy Digital, said in a note last month that the vast majority of lenders he spoke to said they will accept a payment in kind, i.e. in cryptocurrency rather than fiat. They will also largely keep the assets.

Many of the major holders with claims on Mt. Gox assets, he said, are well-known in the bitcoin world. They include the first bitcoin investor Roger Ver, Blockstream co-founders Adam Back and Greg Maxwell, and Bruce Fenton, former executive director of the Bitcoin Foundation.

Based on conversations with institutional investors about to receive payments, “we do not believe there will be significant selling from this group,” Thorn wrote.

However, Glover, who was previously managing director of Barclays, said there was still likely to be significant selling among lenders who, after years of waiting, have the opportunity to make massive gains.

“Some will clearly choose to take the money and run,” Glover said.

JPMorgan Chase analysts said the potential for heavy selling by Mt. Gox lenders creates “downside risk” next month, although it is short-lived.

“Assuming most liquidations by Mt. Gox creditors occur in July, [this] creates a trajectory in which cryptocurrency prices come under more pressure in July, but begin to recover from August onwards,” the analysts wrote.

There is also the likelihood that several bitcoin investors in Mt. Gox have already got it. In the 10 years since the exchange filed for bankruptcy, a secondary market has emerged for those wanting to settle their bankruptcy filing. Those who resisted are the true believers, Thorn said.

“Thousands of these creditors have waited 10 years for payments and have resisted convincing and aggressive credit offers during that time suggesting they want their coins back,” Thorn said. He said he expects limited selling pressure, but acknowledged that if even 10% of the distributed bitcoin is sold “it will have an impact on the market.”

Certain tax consequences may impede sales.

Luke Nolan, an ethereum research associate at digital asset management firm CoinShares, said a big reason Mt. Gox creditors opted for cash repayments has to do with tax implications. And JPMorgan said in a note Monday that people are leaning toward accepting their payout in crypto, “either for tax reasons or because they feel that liquidating now would negate potential price gains in the future.”

Glover said there are ways to avoid a large capital gains tax while still taking advantage of bitcoin’s massive rise in value.

“Those in jurisdictions with capital gains tax may choose to hold their positions to avoid this huge tax burden,” Glover said, “and instead use their bitcoin as collateral to borrow dollars, thereby monetizing bitcoin without having to sell it.”

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SatoshiTimes Staff

We are the editorial team of SatoshiTimes, where seriousness meets clarity in cryptocurrency analysis. With a robust team of finance and blockchain technology experts, we are dedicated to meticulously exploring complex crypto markets with detailed assessments and an unbiased approach. Our mission is to democratize access to knowledge of emerging financial technologies, ensuring they are understandable and accessible to all. In every article on SatoshiTimes, we strive to provide content that not only educates, but also empowers our readers, facilitating their integration into the financial digital age.

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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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Cryptocurrency Charts by TradingView.

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