The long-awaited restitution to users of the now-defunct Mt. Gox exchange may finally be happening in July. However, the market players are feeling nervous about how this distribution will affect the price of Bitcoin. There is a sense of fear regarding potential sell-offs in the market as uncertainty looms around the impact of the Mt. Gox funds on Bitcoin’s price.
Bitcoin has been on a downward trend since the beginning of June, failing to gather enough momentum for a significant upward movement. The price dipped below $60,000 on July 3rd, followed by another drop the next day. Market analysts are now predicting a “subdued” third quarter for Bitcoin, with concerns surrounding the Mt. Gox distribution acting as a major factor in this prediction.
Despite modest inflows from ETFs and the bullish momentum in the US equity market, Bitcoin’s price has been hovering around $57,000. Additionally, Ethereum is also struggling to break past the $3,000 mark. The options market indicates a market anticipation of a potential year-end rally, with significant buying interest in longer-term options at the 100k and 120k strike prices. However, the overall sentiment remains cautious due to the impending Mt. Gox distribution.
In 2014, Mt. Gox lost 850,000 Bitcoin in investor funds, amounting to $9.4 billion owed to approximately 127,000 creditors of the exchange. These creditors have been patiently waiting for over a decade to recover their lost funds after the exchange’s collapse. The upcoming distribution process, scheduled to start in early July, brings relief to the affected users but also raises concerns about additional selling pressure in the market.
As the cryptocurrency community eagerly awaits the restitution process for Mt. Gox users, the market remains cautious about the potential impact on Bitcoin’s price. The uncertainty surrounding the distribution of funds from the defunct exchange has led to fears of further market sell-offs. While the long-awaited restitution is a positive development for affected users, the overall sentiment in the market remains subdued as investors brace for a potentially volatile third quarter.