The Mt Gox case had finally reached a settlement agreement back in 2021, and the BTC owed to creditors is finally ready to be paid out. There are now 140,000 BTC in total that is meant to go to the creditors, which has been a source of joy for those who lost money to the now-defunct crypto exchange. However, given the sheer size of the settlement, bitcoin investors have voiced their concerns regarding dumping such a large number of BTC on the market at such time.
Creditor Addresses RumorsThe rumors that the Mt. Gox BTC would be flooding the market had spread like wildfire through the space. It had led to negative sentiment among investors, who were wary that the added supply would cause the already struggling bitcoin price to fall further. Given this, a Mt. Gox creditor has come forward to clear the air and put investors’ minds at ease.
Eric Wall, which is one of the many creditors of failed crypto exchange Mt. Gox took to Twitter to clear the air about how the BTC would be refunded to creditors. He dismissed the claims that the bitcoins would be released into the market in one fell swoop. Rather, they would be released in tranches.
Bitcoin price runs up above $20,000 | Source: BTCUSD on TradingView.comEven more important was the fact that the repayment system was not even live yet, according to Mr. Wall. He explained that they are yet even to receive instructions on where they want their BTC sent. When the repayment is live, it will be paid out in tranches.
As of now, there is no payment being made. There is no definite date set for the Mt. Gox payments will begin.
What Does 140k BTC Mean?One thing that continues to ring true throughout every single market is the law of supply and demand. Especially during a market such as this, it is important for supply to remain down, so prices have enough time to recover. So if 140,000 BTC is injected into a market and there is not enough demand to absorb it, the price will plummet. This was the reason behind the concern from investors.
However, doing it in tranches, as Wall said, is the best way to divvy out the payments. This way, even if creditors decide to dump their BTC on the market, it will be a small portion at a time, giving the market enough time to absorb every new supply.
The repayment process itself, which is just starting, is going to last months. Creditors have been asked to register to receive their repayment. Given this repayment plan, it is likely that the BTC repaid to creditors will have little to no impact on the price of the digital asset.
Featured image from MARCA, chart from TradingView.comFollow Best Owie on Twitter for market insights, updates, and the occasional funny tweet…
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