Mt. GOX Strikes Back!

WHAT IS Mt. GOX

Mt. Gox was a bitcoin exchange based in Shibuya, Tokyo, Japan. Launched in 2010, it was handling over 70% of all bitcoin (BTC) transactions worldwide by early 2014, when it abruptly ceased operations amid revelations of its involvement in the loss/theft of hundreds of thousands of bitcoins, then worth hundreds of millions in US dollars.

In February 2014, Mt. Gox suspended trading, closed its website and exchange service, and filed for bankruptcy protection from creditors. In April 2014, the company began liquidation proceedings. Although 200,000 bitcoins have since been “found”, the reasons for the disappearance—theft, fraud, mismanagement, or a combination of these—were initially unclear. New evidence presented in April 2015 by Tokyo security company WizSec led them to conclude that “most or all of the missing bitcoins were stolen straight out of the Mt. Gox hot cryptocurrency wallet over time, beginning in late 2011.

Was the dump of Mt. Gox the primary cause of Bitcoin’s crash in 2018?

The now-defunct cryptocurrency exchange Mt. Gox reportedly liquidated around $312 million worth of Bitcoin (BTC) throughout February and June of 2018 through a Japanese exchange called BitPoint.

GoxDox, an organization that was established to assist Mt. Gox creditors, released a photograph of a bank account statement on February 5 showing the alleged transactions sent from BitPoint to the Mt. Gox trustee led by Nobuaki Kobayashi.

According to GoxDox, the Mt. Gox trustee began to sell the exchange’s Bitcoin holdings starting in early 2018, possibly even before February. From early February to June, the trustee is said to have sold tens of millions of dollars worth of Bitcoin on a weekly basis.

Over 24000 BTC with a value of $260m approx. at the time were sold off, many believing this led to the great bear cycle of 2018

DEJA VOUS

Some sources state 200,000 BTC worth roughly $2.8 billion will soon be released into the market as funds lost to the Mt. Gox hack of 2011 and subsequent loss of 850,000 BTC worth around $17.8 billion at today’s price. In 2014 Mt. Gox reported that it had found 200,000 BTC, but those coins have been locked in litigation until now.

In November 2021, Mt. Gox released a formal “Rehabilitation Plan” to return lost funds to investors who lost access to their crypto some 7 years ago. Then, on July 6, 2022, Mt. Gox and “Rehabilitation Trustee” Nobauaki Kobayashi sent email to creditors giving them the option to receive USD, BTC, or BCH. The news brings us closer than ever to funds finally being released to creditors which could be as early as August.

FINAL THOUGHT

The bear may well have a powerful punch left up their slave ready to unleash in the coming weeks, the longer BTC remains arround support levels the greater the probability of a major capitulation drive down is still yet to play

Sources: Wikipedia, Cryptoslate, Finbold