Rumored Bitcoin (BTC) release by Mt.Gox has raised fear in the heart of many even as the digital coin’s price reached a six-week low of about $19,000 on Saturday.
According to multiple news sources, the defunct Japan-based BTC exchange plans to commence its repayment process and release 137,000 bitcoin by the end of the month. Many expressed their reservations about the release of the BTC during this critical market period, claiming that the bitcoin price is currently volatile and may plummet further.
Mt.Gox is a bitcoin exchange in Shibuya City, Tokyo, and it used to be the largest exchange for trading the US dollar for bitcoin by 30-day volume before its infiltration by bad actors in 2014. Almost ten years ago, fraudulent withdrawals were initiated on the exchange’s platform leading to the loss of over 850,000 BTC.
An increasing trend of BTC withdrawal was noticed and this was at a time when the bitcoin price was trading at around $500. Thereafter, the exchange suspended trading on its platform. Additionally, the exchange also halted the withdrawals of funds. Since then, the Mt.Gox exchange has been offline with many tough situations surrounding it.
All 137,000 BTC Will Not be Released in August
Consequently, the Mt. Gox exchange was forced to undergo a rehabilitation process under which they promised to reimburse creditors at the end of August. The exchange spelled out two options to the creditors.
They could either receive an early partial lump sum payment or wait till the civil rehabilitation process is completed and when they could receive a larger sum owing to more availability of funds. The second option is suspected to likely happen in many years to come.
As time is fast approaching, the public crypto community is scared of the consequence the bitcoin dump will have on the market. Trying to conceive the liquidation of 850,000 BTC into the already dwindling crypto market, many believe it would be worse than Luna Foundation Guard’s 80,000 BTC liquidation.
Meanwhile, an Mt. Gox creditor recognized as Eric Wall has released a statement to allay the fears in the heart of many. He denied the release of all 137,000 bitcoin in August instead, Wall mentioned that the repayment process is only just starting.