Bitcoin (BTC) fell below $55,000 in the European and Asian morning hours. The sell-off happened after wallets belonging to the collapsed crypto exchange Mt. Gox showed activity for the first time in a month.
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Mt. Gox, the defunct Japanese crypto exchange, sent 47,229 Bitcoin worth more than $2.6 billion at current prices — to a new wallet address in its first large transaction since May.
Mt. Gox’s BTC on the move
After years of postponed deadlines, Mt. Gox is expected to start distributing assets stolen from clients in a 2014 hack this month. However, the exact date may be uncertain. The reimbursements will be made in Bitcoin and Bitcoin cash (BCH), and as previously reported, they could potentially increase selling pressure in both markets.
The Mt. Gox wallets conducted test transactions in the Asian morning, moving a total of $25 worth of bitcoin across three transactions across multiple wallets, as evidenced by the wallets tracked by Arkham.
Arkham Intelligence subsequently states that the exchange transferred the Bitcoin from “cold storage” at 12:30 am UTC on July 5.
The exchange is expected to start repaying creditors this month. This movement coincides with this plan. Creditors are expected to receive a total of $8.5 billion in Bitcoin.
According to a June 24 statement from Mt. Gox trustee Nobuaki Kobayashi, the company informed creditors that it completed all the necessary steps to start making repayments in July.
Mt. Gox added, “We have taken time to ensure safe and reliable repayment to creditors, including technical remedies for safe repayments, compliance with financial regulations in each country, and discussion of repayment arrangements with the cryptocurrency exchanges.”
Crypto coins trade on the red
Several market analysts have sounded alarm about the huge volume of Bitcoin that could enter the market as a result of Mt. Gox creditors selling their holdings. These holdings have been unavailable for almost 10 years.
Mt. Gox is not the only entity that has been moving huge sums of BTC. Arkham data also shows that the German government transferred $175 million in BTC to several wallets, with $75 million going to crypto exchanges Kraken and Coinbase.
The sharp sell-off has turned the horizontal support of $56,500 from May lows into resistance.
BTC and major altcoins have tanked, some in double digits. At the time of writing, Bitcoin is worth $54,192.86, a 7.6% drop in the last 24 hours. Also, the global crypto market cap has lost 8.85% market share and is now worth $2.08 trillion.
Also Read: Bitcoin’s derivatives data says the bulls are still alive and kicking
Ethereum, the second largest crypto, is currently worth $2,848.37, having lost 11.6% market share in 24 hours. Solana is also down 7.9% and is currently worth $124.79.
Cryptopolitan Reporting by Florence Muchai
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