Mt. Gox, the defunct crypto exchange, continues its Bitcoin repayments to creditors, as recent on-chain data shows a significant movement of BTC. This has sparked curiosity about how much Bitcoin Mt. Gox still has left, given the negative impact these repayments have had on the price of the flagship cryptocurrency so far.
The on-chain analytics platform, Arkham Intelligence, revealed that a wallet (bc1q26) which received $2.19 billion worth of Bitcoin from Mt. Gox had initiated test transactions. This wallet is believed to belong to Bitgo, the fifth and final exchange approved by the trustee for BTC repayments. Bitgo may be preparing to distribute these Bitcoins to creditors, as they subsequently moved Mt. Gox’s $2 billion BTC to another wallet (bc1qpn5), possibly as a security measure before starting repayments.
The recent Mt. Gox Bitcoin repayments caused panic in the crypto market, with Bitcoin dropping to as low as $54,000. There were concerns that creditors might sell off their BTC upon receipt, adding selling pressure to the market. However, data from Cryptoquant revealed that Mt. Gox creditors chose to hold onto their BTC rather than sell. This resulted in a spike in withdrawals from Kraken, indicating that creditors were moving their coins to cold wallets.
Despite these transfers, Mt. Gox still holds 46,164 BTC ($2.81 billion), which could still have a significant impact on the market if other creditors also choose to hold onto their BTC.
Bitcoin has been trading sideways as investors await the July Consumer Price Index (CPI) inflation report, set to be released on August 14. A positive inflation reading could strengthen the case for the US Federal Reserve to cut rates in September, boosting investor confidence in risk assets like Bitcoin and other cryptocurrencies. The Producer Price Index (PPI) inflation report released on August 13 was positive, coming in lower than expectations. A positive CPI report may confirm the slowing of inflation and prompt the Fed to proceed with rate cuts. Analysts predict that Bitcoin’s price could turn bullish again when the Fed cuts interest rates.
In conclusion, Mt. Gox’s Bitcoin repayments and the upcoming inflation reports are key factors influencing the market sentiment and price of Bitcoin. The movement of significant amounts of BTC from Mt. Gox and the decisions of creditors to hold onto their BTC will continue to impact the crypto market in the coming weeks. Investors are closely monitoring these developments to gauge the future direction of Bitcoin and other cryptocurrencies.
