Early Tuesday marked a significant movement of nearly 107,000 bitcoins, causing a temporary decrease of 1.2% in Bitcoin’s value. This action is linked to Mt. Gox, previously the largest Bitcoin exchange, whose downfall deeply impacted the cryptocurrency market.
Speculations suggest that these might be the bitcoins once stolen from the exchange. Such a large movement can cause a momentary shiver in the market as holders sell off their shares, leading to a temporary drop in value.
Mt. Gox was victim to a catastrophic cyber-attack in 2014 that saw a large number of Bitcoins lost, sparking panic among investors and causing a sharp decline in Bitcoin’s value. This event was instrumental in creating the selling pressure witnessed recently in Bitcoin markets.
Bitcoin value fluctuations following significant shift
In the early hours of the same day, over 140,000 bitcoins were transferred into an unidentified wallet, totaling thirteen transactions. The sum of these transactions equals roughly $9 billion, causing Bitcoin’s value to dip ever so slightly before quickly recovering.
All bitcoins owned by Mt. Gox have now accumulated in one Bitcoin wallet, marking the first asset movement from Mt. Gox’s cold wallets in over five years. This move is likely part of a broader strategy to distribute the assets among the creditors by October 31, 2024. Over 140,000 bitcoins valued at more than $6 billion are involved in this operation.
The head of research at CryptoQuant, Julio Moreno, confirmed the move. Alex Thorn, Galaxy’s head research, proposed that most of the transferred bitcoins will likely be held by creditors instead of being sold in the open market.
However, this movement dampened the market sentiment as Bitcoin’s value dropped to $67,680 from Monday’s high of over $70,000. Investors in turn became nervous and started selling off, translating into a noticeable surge in traffic on various blockchain platforms.
Shaurya, the Deputy Managing Editor on the Data & Tokens team, is closely monitoring these developments. His main focus is on how decentralized finance systems demonstrate resilience and how different governance protocols across major and minor blockchains respond to such fluctuations.
