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Big BTC Crash Ahead? Mt. Gox Creditors To Be Paid In Bitcoin After Making Over 2,000% Gains

Big BTC Crash Ahead? Mt. Gox Creditors To Be Paid In Bitcoin After Making Over 2,000% Gains
© Copyright Image: ZyCrypto

  • Mt. Gox creditors can expect a big payday following the confirmation of the rehabilitation plan by a Japanese court.
  • The sheer amount of Bitcoin to be distributed to creditors could send the markets spiraling downwards.
  • However, some believe that the markets are mature and can withstand the shockwaves of a potential sell-off.

The Mt. Gox saga is coming to an end but another one could be brewing in the corner that could spell trouble for investors. As creditors begin to receive their assets after years, analysts warn traders to keep an eye out on the potential impact that it could have.

The Seal Of Approval On The Rehabilitation Plan

A Japanese court has given the seal of approval to the rehabilitation plan filed to compensate Mt. Gox’s creditors. The assent by the court makes the plan “final and binding” and affected individuals can begin receiving their assets. 

While the details of the disbursements are sketchy, Mt. Gox trustee Nobuaki Kobayashi stated that he will reveal further information about the process. In his letter to all affected parties, Kobayashi confirmed the court’s approval and thanked all affected parties for their cooperation throughout the process.

“The Rehabilitation Trustee would like to express sincere gratitude to all involved parties for their understanding and support, which led to the Rehabilitation Plan becoming final and binding,” Kobayashi wrote. “The Rehabilitation Trustee will then make repayments to rehabilitation creditors to holding allowed rehabilitation claims in accordance with the Rehabilitation Plan. An announcement will be made to rehabilitation creditors on the details of the specific timing, procedures, and amount of such repayments.”

The issue is a fall-out from the infamous Mt. Gox hack of 2014 which led to the loss of around 850,000 Bitcoins. At that time, Mt. Gox was the largest Bitcoin exchange in the world and accounted for nearly 70% of all Bitcoin transactions worldwide.

The Incoming Crash

The influx of a large number of Bitcoins to creditors may hurt the asset prices as analysts point to a potential sell-off. At the time of the Mt. Gox hack, the lost Bitcoins were worth way less than they are today as BTC straddles $60K. Since the asset has more than doubled in value, it is thought that creditors may sell to take profits. The amount of BTC to be disbursed stands at a staggering 141,686 BTC which surpasses the entire BTC holdings of MicroStrategy.

According to Avi Felman, manager at BlockTower Capital, the disbursement of funds is an event that all market participants will need to keep their eyes on. However, some analysts believe that a majority of the coins will not be sold because a bulk of the creditors are long-term holders, getting into the markets because of their long-term vision.

Ben Caselin, Head of Research and Strategy at AAX believes that despite the fact the amount of Bitcoins is significant, the industry has evolved to shrug off the effects. He said, “any capitulation that brings Bitcoin below its fair value is likely to be met with accumulation.”

Read more: https://zycrypto.com/big-btc-crash-ahead-mt-gox-creditors-to-be-paid-in-bitcoin-after-making-over-2000-gains/

Text source: ZyCrypto

Disclaimer: Financial information and news are not financial advice, read the disclaimer.
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