How Mt. Gox’s Massive $2.7 Billion Bitcoin Transfer Led To Significant Market Turbulence & Investor Anxiety

Mt. Gox, the collapsed Japanese crypto exchange, made headlines again by transferring 47,229 Bitcoin, worth $2.71 billion at current prices, to a new wallet address. The major transfer happened at 12:30 am UTC on July 5 and was the first major move from the exchange since May. Blockchain analytics platform Arkham Intelligence noted this transfer, involving Bitcoin stored in “cold storage.”

In recent months, Mt. Gox has conducted several smaller test transactions. The exchange plans to start repaying creditors this month by distributing $8.5 billion worth of BTC. On the same day, Mt. Gox also transferred 1,545 BTC to Bitbank’s hot wallet, a crypto exchange involved in the repayment process.

Mt. Gox trustee Nobuaki Kobayashi stated on June 24 that all steps needed to begin repayments in July are complete. Despite these preparations, market commentators worry about the impact of such a large amount of BTC entering the market. They fear that creditors selling their holdings, which have been inaccessible for over a decade, could trigger a significant sell-off.

However, some analysts think the actual amount of BTC likely to be sold is closer to $4.5 billion. Galaxy Digital’s head of research, Alex Thorn, suggested that many Mt. Gox Bitcoin holders might prefer to keep their assets to avoid the adverse impact of capital gains taxes if they sell all at once.

Bitcoin Market Trends

On May 28, Mt. Gox moved nearly $7.3 billion worth of Bitcoin to an unknown wallet, causing Bitcoin’s price to drop. The exchange holds a large amount of Bitcoin (142,000 BTC), Bitcoin Cash (143,000 BCH), and other assets totaling 69 billion yen.

Bitcoin continues to decline, falling below $54,000 today. According to CoinMarketcap, it is trading around $54,143.54, down nearly 9% in the last 24 hours and about 13% in a week. The price is now at its lowest level in five months.

Furthermore, the author’s views are for reference only and shall not constitute investment advice. Before purchasing, please ensure you fully understand and assess the products and associated risks.