Key Points
- An address related to Mt. Gox has transferred 1,550 BTC, worth $85 million, to Bitbank.
- Speculations about a potential large-scale selloff impacting the broader cryptocurrency market have been fueled by these significant transfers.
A transfer of 1,550 Bitcoin (BTC), equivalent to $85 million, from a Mt. Gox-related address to Bitbank has been reported by blockchain security firm PeckShield.
In addition to this, PeckShield observed another transfer of a staggering 47,200 BTC ($2.7 billion) from a Mt. Gox-labeled address to a new address earlier in the day.
Potential Impact on Cryptocurrency Market
These substantial transfers have sparked speculation about a possible selloff, which could influence the larger cryptocurrency market.
Mt. Gox, the well-known cryptocurrency exchange that collapsed in 2014 due to a hack resulting in the loss of approximately 740,000 Bitcoin, recently announced the commencement of repayments to its creditors.
This has ended a nearly decade-long wait for users to reclaim their lost crypto assets.
The crypto community has expressed concerns over the possibility of a large-scale selloff from Mt. Gox wallets.
Given the significant amount of Bitcoin involved, any major liquidation could put downward pressure on Bitcoin prices, possibly leading to increased market volatility.
Market Reactions and Analyst Perspectives
Market participants are closely observing these movements, as the timing and scale of any selloff could further influence trading strategies and overall market sentiment.
Despite popular speculations, analysts suggest that Bitcoin might not experience significant price drops due to the Mt. Gox repayments.
Peter Chung, Head of Presto Labs, believes that the impact on Bitcoin will be minimal. He argues that most of the Mt. Gox creditors are long-term holders, often referred to as ‘diamond-handed’ investors, who are unlikely to sell their Bitcoin immediately.
This viewpoint is also shared by Alex Thorn, Head of Research at Galaxy Digital, who highlighted that these creditors are typically tech-savvy early adopters of Bitcoin, suggesting they will retain their holdings rather than liquidate.
Thorn also pointed out the potential capital gains impact as a deterrent to selling, noting that the price appreciation of Bitcoin means significant tax implications for those who choose to sell now.
Given these factors, the analysts predict that the anticipated selloff pressure from Mt. Gox repayments will be much less severe than the market fears.
This outlook contrasts sharply with the situation for Bitcoin Cash (BCH), which is expected to face substantial selling pressure due to its weaker investor base and lower liquidity.
According to Presto Labs’ analysis, the BCH market could see sales amounting to 24% of its daily trading volume, compared to just 6% for Bitcoin.
