Markets
Bitcoin Falls as Mt. Gox Refund Shakes Crypto Market
Bitcoin fell on Friday, alongside crypto-related stocks, with the leading cryptocurrency recently trading at its lowest level in months.
Mt. Gox’s bankruptcy trustee has begun paying off creditors, sending shockwaves through the cryptocurrency market.
Mt. Gox, once the world’s largest bitcoin exchange, collapsed following a hack in 2014.
The news weighed on shares of Coinbase Global and MicroStrategy, while ether fell alongside bitcoin.
Prices of major cryptocurrencies, as well as shares of Coinbase Global (COIN) and MicroStrategy (MSTR), fell Friday as bankrupt crypto site Mt. Gox began repaying its creditors.
Nobuaki Kobayashi, the trustee in the Mt. Gox bankruptcy, said the estate “has made repayments in Bitcoin and Bitcoin Cash to some of the rehabilitation creditors through a portion of the designated cryptocurrency exchanges, etc., in accordance with the rehabilitation plan.”
He stressed that other creditors would be repaid “promptly” when certain conditions were met, including that they could be repaid “safely”.
Bitcoin (BTCUSD) was trading around $55,700, down about 2.4%, as of 10:45 a.m. ET Friday. Ether was down about 3.4%.
The 2014 Mt. Gox hack resulted in an estimated loss of 740,000 bitcoins
Mount Gox was once the world’s largest cryptocurrency exchange, at one point handling 70% of bitcoin transactions. A hack in 2014 that resulted in the loss of approximately 740,000 bitcoins led to the company’s demise.
The Mt. Gox announcement, which Kobayashi announced last month for July, had already begun to disrupt the cryptocurrency market. Today’s announcement sent bitcoin to a five-month low.
The impact was also felt by Coinbase, which said it generated $935 million in revenue from its customers’ cryptocurrency trading in the first quarter, double what it did in the fourth quarter. MicroStrategy said in its first-quarter financial report that it held 214,400 bitcoins.
Shares of Coinbase were down about 5% at $213.87 as of 10:45 a.m. ET Friday, while MicroStrategy fell more than 6% to $1,220.11. Still, shares of Coinbase and MicroStrategy have jumped about 23% and 93% since the start of the year.
Read the original article on Investopedia.