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Mt. Gox $2.7 billion repayment announcement leads Bitcoin to drop to five-month low below $55,000
The price of Bitcoin dropped to a five-month low, falling below $55,000, following the announcement from the defunct exchange Mt. Gox that it has commenced repayments to creditors.
Mt. Gox initiates repayment
On July 5, the Rehabilitation Trustee of Mt. Gox revealed that it has begun the process of repaying creditors via specified crypto exchanges in accordance with the rehabilitation plan.
Creditors who qualify will receive timely repayments if they fulfill certain criteria. These requirements include verifying the legitimacy of registered accounts, agreeing to the terms of an agreement through designated crypto exchanges, and finalizing discussions with the trustee.
This announcement came after the failed exchange transferred a significant quantity of Bitcoin in multiple transactions today. Data from Arkham Intelligence indicates that Mt. Gox moved 47,228.7 BTC, valued at $2.71 billion, to a new wallet. The assets were later moved in several transactions, including 1,545 BTC, worth $85 million, to a wallet associated with the Bitbank exchange.
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In the meantime, members of the crypto community have reacted positively to this news, as it concludes a decade-long wait for Mt. Gox’s creditors to reclaim their digital assets. In 2014, Mt. Gox experienced a significant hack, resulting in the loss of 850,000 Bitcoin—currently valued at over $57 billion. Following the hack, Mt. Gox entered bankruptcy and initiated rehabilitation proceedings in 2018 to reimburse creditors.
Bitcoin falls below $55K
In the wake of the Mt. Gox repayment announcement, Bitcoin’s price decreased by more than 7.2%, reaching $54,209. According to data from CryptoSlate, this marks the first instance the asset has dipped below the $55,000 threshold since February 2024.
Reports indicated that this decline triggered one of the largest liquidation events the industry has experienced this year. As per Coinglass, crypto traders speculating on the market’s digital asset prices incurred losses exceeding $675 million within the last 24 hours.
Long traders anticipating a price rise faced losses of around $578 million, while short traders lost $98 million.
Bitcoin traders experienced the most significant losses, with over $225 million liquidated in the past day. Ethereum traders encountered liquidations totaling approximately $167 million. Additionally, Bitcoin Cash, another digital asset linked to the Mt. Gox repayment, also experienced about $3.8 million in liquidations.
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