Bitcoin (BTC) Price May Not Be Affected By Mt. Gox Repayments After All; Here’s Why

Bitcoin (BTC) Price May Not Be Affected By Mt. Gox Repayments After All; Here’s Why

Cryptocurrency Mix
December 30, 2022 by Admin
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What is the current status of Mt. Gox repayments and how will they affect the price of Bitcoin (BTC)? Background: Bitcoin has always been a volatile asset. Its value fluctuates rapidly and without warning, which can make it difficult for investors to predict the market. One of the biggest events in the history of Bitcoin
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What is the current status of Mt. Gox repayments and how will they affect the price of Bitcoin (BTC)?

Background:

Bitcoin has always been a volatile asset. Its value fluctuates rapidly and without warning, which can make it difficult for investors to predict the market. One of the biggest events in the history of Bitcoin was the collapse of the Mt. Gox cryptocurrency exchange in 2014. Mt. Gox was the largest Bitcoin exchange in the world at the time, handling up to 70% of all Bitcoin transactions. The exchange went bankrupt after losing 850,000 Bitcoins, valued at around $8.5 billion at the time. The stolen Bitcoins were later found, and the process of returning them to their rightful owners has been an ongoing one ever since.

The Repayments:

In June 2018, a Japanese court approved the repayment of the stolen Bitcoins to the victims of the Mt. Gox hack. The process of repaying the Bitcoins began in February 2019, and as of June 2021, over 170,000 Bitcoins had been returned to their owners. While this is good news for those who lost their Bitcoins in the hack, many investors were worried that the repayment process would have a negative effect on the price of Bitcoin.

Why the Repayments May Not Affect the Bitcoin Price:

Despite fears to the contrary, it seems that the Mt. Gox repayments may not have a significant effect on the Bitcoin price after all. There are a few reasons for this. Firstly, the number of Bitcoins being repaid is relatively small compared to the total number of Bitcoins in circulation. The current circulating supply of Bitcoin is around 18.6 million, and the number of Bitcoins being returned to Mt. Gox victims is only around 150,000. This means that the repayments are unlikely to cause significant market disruption.

Another reason why the repayments may not affect the Bitcoin price is that many of the Mt. Gox victims may choose to hold onto their Bitcoins rather than sell them. This is because some of the victims may have bought their Bitcoins at a much lower price than they are worth today. As a result, they may be reluctant to sell their Bitcoins at current market prices, especially if they believe that the Bitcoin price will continue to rise in the future.

Conclusion:

In conclusion, while the Mt. Gox repayments are an important development in the world of Bitcoin, it seems that they may not have the negative effect on the Bitcoin price that many investors had feared. With the relatively small number of Bitcoins being returned and the possibility that many of the victims may choose to hold onto their Bitcoins, the repayment process is unlikely to cause significant disruption in the market. As always, however, investors should remain vigilant and keep an eye on market developments to ensure that they are making informed decisions.

Sources:

  • https://www.coindesk.com/mt-gox-restitution-to-end-soon-but-how-will-it-affect-bitcoin
  • https://cointelegraph.com/news/mt-gox-reparations-could-stall-the-btc-market-what-are-the-chances
  • https://www.cnbc.com/2020/07/03/why-the-mt-gox-cryptocurrency-debacle-is-still-tearing-industry-apart-6-years-later-and-may-be-delayed-yet-again.html