The development has triggered concerns of an impending large-scale market dump which could impact Bitcoin’s value.
The Bitcoin (BTC) community has raised concerns about an impending large-scale market dump on the back of circulating misinformation suggesting that defunct BTC exchange Mt. Gox would release its 137,890 BTC ($3.05 billion) starting from March 10. Blockchain surveillance system Lookonchain called attention to this development today.
Mt. Gox creditors may receive repayments from March 10 onward.
137,890 $BTC($3B) unlock is coming soon!
Mt. Gox suspended withdrawals on Feb 7, 2014, when the price of $BTC was ~$800.
And the current price of $BTC is $22,408.
Will creditors sell $BTC after receiving it? pic.twitter.com/hEgxGc1uJy
— Lookonchain (@lookonchain) March 6, 2023
Nonetheless, according to a statement, the bankrupt exchange plans to start repayment to creditors starting from Sept. 30. March 10 is only the new deadline for submitting payee information and selecting a repayment method.
According to the latest statement, the Rehabilitation Trustee adjusted the deadline from the earlier Jan. 10 deadline initially announced. Creditors have been advised to coordinate with an exchange to receive their digital assets on their behalf.
Accordingly, early repayments have been re-scheduled to commence from Sept. 30 instead of the former July 31 date. While the specific amount of BTC tokens that will be released is not yet precise, it is known that Mt. Gox currently holds a balance of 137,890.98 BTC. Payments are expected to be made in a combination of Bitcoin, Bitcoin Cash, and fiat currencies.
The Trustee has urged creditors to choose their preferred payment method. However, following the latest statement, creditors who neglect to select their payment method or register their relevant information before the March 10 deadline will not be eligible to receive their payments.
The Mt. Gox Saga
Following the initial announcement last October, which disclosed plans to release the $3 billion worth of BTC to creditors, the crypto community raised concerns about a massive, large-scale dump that could ensue, impacting Bitcoin’s fragile position. It is currently unclear whether or not recipients will choose to sell their assets upon receiving them.
Last October, apprehensions of a BTC dump emerged following reports that 10K BTC tokens moved on-chain belonged to Mt. Gox. These reports were later debunked by an Mt. Gox creditor who noted that the repayment system was not yet live.
Ripple co-founder Jed McCaleb initially launched Mt. Gox in 2006 as a platform for trading cards from the video game Magic: The Gathering Online. However, in 2010, McCaleb developed an interest in Bitcoin and transformed Mt. Gox into a Bitcoin exchange in the same year. McCaleb sold the exchange 10 months later.
Shortly after, Mt. Gox grew massively to the extent that it was processing 70% of all global BTC trading volume as of early 2014. Following reports on hacks, alleged deceptions, and persistent issues, Mt. Gox filed for bankruptcy in Tokyo in February 2014.
The firm noted that it had lost 750K BTC belonging to customers and 100K of its own BTC tokens. After elongating investigations and bankruptcy proceedings, Mt. Gox and the Tokyo authorities unveiled a plan to repay creditors.