Blockchain, Blockchain News

Uncertainty looms over Bitcoin as Mt. Gox prepares for final payout

February 2014. The Tokyo-based cryptocurrency exchange Mt. Gox, a Tokyo-based cryptocurrency exchange, was compromised in 2010. It was founded in 2010, and handled more than 70% of all transactions worldwide. Hackers stole more than 850,000 bitcoins, which was 80% of the total amount of bitcoins.

After 7 years of the exchange’s collapse, 2,00,000. BTC were lost. The wallet was found months later, after the company filed bankruptcy.

Even though a Japanese court was charged with the daunting task of compensating aggrieved investors it appeared that there was little chance that these early bitcoin investors or creditors would be able to make any significant monetary recovery. However, this is changing.

What’s new?

According to a letter sent by Nobuaki Kobayashi’s representative, around 99 percent of creditors voted for the rehabilitation plan and the distribution of these recoveries. This has been approved also by the court.

Kobayashi stated that the asset distribution process would not begin until the details of the plan have been finalized. However, there is no set timeline for funds being released. The repayment pool is only made up of around 1,41,686 BTC, which amounts to approximately $8.8 billion. It also includes bitcoin cash and fiat currencies, bringing the total pool value to 1,50,000 BTC.

Market frenzy

Markets, however, are not keen on welcoming this major surge of bitcoin, given that most analysts are divided on whether there is anymore absorption potential present, with Bitcoin currently trading at $56,833, experiencing a 7-day decrease of 10.81 percent and falling almost 5 percent just in the last 24 hours.

While some believe that there will be significant volatility and price variations in the market, there are others who think that those who will be compensated are long-term holders of Bitcoin and therefore are unlikely to sell anytime soon. The distribution is likely to take place in a phased manner, given that a one-time dump will cause a noticeable market disturbance.