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Mt. Gox: $ 9 billion to creditors could cause selling pressure

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Bankruptcy trustee of the Japanese exchange Mt. Gox, which closed in 2014, announced that creditors had approved a plan to distribute more than $ 9 billion in BTC.

Return of funds to creditors

About 99% of creditors approved the payment plan and about 83% approved the total amount. The administrator also announced that, depending on the situation, the order confirming the plan should be final and binding in approximately one month, ie. around November 20.

At that moment, the insolvency administrator will make installments to the creditors, to whom a special notice will be sent about the timing and manner of these installments.

After the confirmation order is final and binding, creditors will be asked to send their bank account information to the official Mt. Gox,

The saga of Mt. Gox

Mt. Gox was once the largest cryptocurrency exchange responsible for 70% of transactions in the early days of BTC. That all changed after the notorious hack seven years ago. In February 2014, about 850,000 BTCs worth about $ 500 million were stolen from the exchange at that time.

When the exchange was closed in February 2014, one BTC was only worth about $ 700, so its value has increased 93 times since then. This means that although only a few BTCs remain in the box office of the bankrupt company, their value is now significantly higher than it was at the time of closing.

Creditors have long been given the choice of whether to prefer repayment in fiat currency or in BTC, with preference given to those who have chosen fiat currency. Those who choose BTC will be distributed the remaining funds after payments made in fiat currency.

In September 2019, the trustee in bankruptcy stated that Mt. Gox remained 141,686 BTC, which would be worth more than $ 9 billion today.

Sales pressure

So it is estimated that victims could receive somewhere around $ 9 billion in BTC and BCH at today’s prices. Crypto-community members are thus afraid that they could get rid of their coins immediately after years of waiting, which could increase selling pressure on the market and lead to a price correction.

It is estimated that about $ 1.7 billion in Fiat currency will first be distributed to about 10,000 creditors by depositing them in their bank accounts, while the remaining about 125,000 BTC and 142,000 BCH should be repaid later. So far, no details have been provided on how the BTC and BCH installments will be distributed, not even the timing.

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