According to data from Arkham Intel, Mount Gox initiated the process of repaying creditors by transferring a nominal amount of Bitcoin to one of the designated exchanges. This development follows months of speculation and planning regarding the payout of approximately $8.2 billion in Bitcoin owed to creditors of the defunct exchange.
Are Mount Gox Bitcoin refunds starting?
Early today, three wallets historically linked to Mount Gox made three transactions. The most significant of these involved the transfer of $24 in Bitcoin to a wallet, which then sent this money to Bitbank’s hot wallet. Bitbank, listed as one of the exchanges authorized to facilitate refunds alongside Kraken, Bitstamp, SBI VC Trade and Bitgo, plans to make these funds available to its customers within a time frame of up to 90 days after receipt.
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However, there is some uncertainty surrounding these transactions because the funds are not transferred directly from the primary Mt. Gox wallets was moved. Observers speculate whether this activity could be a preliminary test ahead of larger transfers intended for repayment to creditors. The Mount Gox Rehabilitation Trustee has previously indicated the repayment process would begin in early July, although specific dates for the transfers have not been made public.
The other two transactions, one transfer of BTC worth $3.00 and another worth $0.32, were transferred to a new wallet.
This subtle money move comes amid a turbulent period for Bitcoin, which has seen its price fall more than 20% since hitting $72,000 and now hover around $57,700.
What to expect
Peter Chung, head of research at Presto Research, recently as long as understanding the wider implications of Mount Gox’s refunds. He outlined the expected dynamics between Bitcoin (BTC) and Bitcoin Cash (BCH) and predicted significant trading opportunities.
“The Mount Gox Rehabilitation Trustee plans to distribute multi-billion dollars worth of BTCs and BCHs to Mount Gox’s creditors between July 1 and October 31, 2024. This will likely change the supply/demand dynamics in BTC and BCH during these four years. monthly period, potentially opening up a trading opportunity for pairs,” he stated.
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Chung highlighted the divergent impacts on BTC and BCH: “Our analysis shows that selling pressure for BCH will be four times greater than for BTC – i.e. 24% of the daily trading value for BCH versus 6% of the daily trading value for BCH. BTC. This difference reflects the divergent investor bases, with BCH being significantly weaker and more likely to sell its positions.”
He advised traders on possible strategies: “Long BTC perpetuals combined with short BCH perpetuals is the most efficient, market-neutral way to express this view, barring funding interest rate risk.” For those concerned about volatile financing rates, Chung recommended “exploring other approaches such as short-term futures or borrowing BCH in the spot market.”
At the time of writing, BTC was trading at $57,727.
Featured image created with DALL·E, chart from TradingView.com