The trustee of the failed Japanese cryptocurrency exchange Mt. Gox is preparing to initiate repayments of bitcoin bitcoin (BTC) and bitcoin cash (BCH), prompting fears of a market sell-off among traders and investors.Confirming repayment detailsThe crypto community on the /mtgoxsolvency subreddit disclosed that the Tokyo-based bitcoin exchange has initiated the process of verifying creditors’ addresses for forthcoming repayments. Emails have been sent to creditors, confirming that their repayment details have been validated with relevant cryptocurrency exchanges.The communication from Mt. Gox appears to be staggered, with users on different platforms receiving emails at varying times. Some Bitstamp users reported receipt of the email, while several Kraken customers mentioned that they were still awaiting the confirmation.Mt. Gox, cautioning creditors, clarified that users with disabled or frozen accounts would not be able to receive repayments using the provided addresses. Additionally, the emails specifically pertain to payments in bitcoin and bitcoin cash.This recent communication follows Mt. Gox’s announcement in November, where it committed to returning approximately 142,000 bitcoin, 143,000 bitcoin cash and 69 billion Japanese yen, valued at over $5.67 billion at the announcement date and approximately $6.46 billion at the present moment.During the November announcement, Mt. Gox assured creditors that repayments would commence in the following months and weeks. Creditors with payment methods deemed “effective at this time” were earmarked to receive their assets first.Towards the end of December, some creditors reported the addition of yen-denominated balances to their PayPal accounts by Mt. Gox, signaling progress in the repayment process.Market fearsThe fear among market participants of a distribution of bitcoin from the Mt. Gox estate has cast a shadow over the sector over the course of a number of years. With this latest development, it appears that the estate is finally on the cusp of executing on that distribution.If distribution is achieved in the short term, it will come at a time when bitcoin has experienced a major unit price pullback already. Since the approval of spot bitcoin exchange-traded funds (ETFs) in the United States earlier this month, it appears that another bankrupt crypto exchange, FTX, has sold $1 billion worth of Grayscale Bitcoin ETF shares into the market. That move is believed to have been responsible for a dramatic drop in bitcoin’s unit price.In tandem with that event, some commentators believe that a pullback at this point is healthy for the market. That’s the view of Charles Edwards, founder of Capriole Investments. Taking to social media, Edwards wrote:”We’re still not here yet. This pullback is very overdue and lower is healthier.”At the time of writing, bitcoin has a unit price of $39,884, down from a high earlier this month of $48,494.Confirmation emails have been reported by several Reddit users, with Bitstamp confirming for most, and a few Kraken users also acknowledging receipt. Nevertheless, a significant number of Kraken users mentioned they are yet to receive the confirmation email.Mt. Gox officially closed its doors in February 2014, almost a decade ago, after succumbing to an exploit in 2011.

Leave a Reply

Your email address will not be published. Required fields are marked *