Markets
Mt. Gox set to sell $9 billion worth of Bitcoin – what it means for BTC
Omer Taha Cetin | Anadolu | Getty Images
A bitcoin The exchange that collapsed 10 years ago after being hacked is set to return billions of dollars worth of tokens to its users — and that has investors worried.
In a few days, Mt. Gox, a bankrupt Tokyo-based bitcoin exchange, will begin reimbursing thousands of users in tokens worth nearly $9 billion. The platform went bankrupt in 2014 following a series of robberies which cost him approximately 650,000 has 950,000 bitcoin, or more than $58 billion, at current prices.
The payment follows a lengthy bankruptcy process that involved numerous delays and legal challenges.
On Monday, the court-appointed trustee overseeing the stock exchange’s bankruptcy proceedings said Distributions to the company’s roughly 20,000 creditors will begin in early July. The payments will be made in a mix of bitcoin and bitcoin cash, an early version of the original cryptocurrency.
While this is good news for hacking victims who have spent years waiting to be compensated, bitcoin price dropped to $59,000 last week in the crypto market second worst weekly decline of the year.
CNBC spoke to half a dozen analysts to find out what to expect when about 141,000 bitcoins – or about 0.7% of the total 19.7 million bitcoins in circulation – are returned to victims of Mt. Gox this week.
Pressure on Bitcoin could increase
Mt. Gox – short for “Magic: The Gathering Online Exchange” – was once the world’s largest bitcoin spot exchange, claiming to handle about 80% of all global dollar-for-bitcoin transactions.
When it closed in February 2014, bitcoin was worth around $600.
Today, the world’s largest cryptocurrency is trading at around $61,000 per coin. This means that users choosing to be repaid in kind – that is, in the cryptocurrency itself rather than the cash equivalent – saw the value of their coins increase by more than 10,000% in over the last decade.
John Glover, chief investment officer of cryptocurrency lending firm Ledn, told CNBC that the boon for Mt. Gox users would likely translate into huge bitcoin sales as investors look to lock in their gains .
“Many are clearly going to cash in and enjoy the fact that having their assets tied up in the Mt. Gox bankruptcy is the best investment they’ve ever made,” said Glover, who was previously chief executive of Barclays. “Some will clearly choose to take the money and run,” Glover added.
James Butterfill, head of research at CoinShares, told CNBC that the nearly $9 billion surplus of bitcoins expected to be released has “long been a concern for those who have a bullish view of bitcoin.”
““So the market is very sensitive to any news on this. With the announcement that the Trust will start selling in July, investors are understandably worried,” Butterfill said.
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This wouldn’t be the first time that bitcoin has moved in response to massive redemptions of funds locked up on centralized trading platforms.
Last month, cryptocurrency exchange Gemini returned more than $2 billion worth of bitcoin to users whose funds had been locked in its Earn lending program, marking a 230% recovery after bitcoin prices more than tripled since Gemini suspended Earn withdrawals on Nov. 16.
JPMorgan analysts linked this to negative price action, saying in a research note last week that it was “fair to assume that some of Gemini’s creditors, who are mostly retail clients, took less partial profits in recent weeks.
Likewise, JPMorgan analysts expect that Mt. Gox clients will also be inclined to sell some of their bitcoins to take advantage of the cryptocurrency’s seismic gains.
“Assuming most liquidations by Mt. Gox creditors occur in July, [this] “This creates a trajectory where cryptocurrency prices come under additional pressure in July, but begin to rebound from August onwards,” they wrote.
Separately, last month, the German government sold 5,000 — worth about $305.8 million at Thursday’s prices — of a stack of 50,000 bitcoins seized in the Movi2k movie piracy operation.
The funds were sent to various cryptocurrency exchanges including Coinbase, Kraken and Bitstamp, according to Arkham Intelligence, a blockchain intelligence company.
Analysts say these crypto liquidations have also put pressure on the price of Bitcoin.
Mt. Gox Customers Should Hold On To Their Bitcoin
Most analysts agree that bitcoin’s losses will likely be contained and short-lived.
“I think the concerns about the Mt. Gox selloff are likely to be short-term,” said Lennix Lai, chief commercial officer of cryptocurrency exchange OKX.
“Many Mt. Gox users and creditors are long-time bitcoin enthusiasts who are less likely to immediately sell all of their bitcoins,” he said, adding that previous sales by law enforcement, including the Silk Road affairdid not lead to a catastrophic and lasting drop in prices.
Butterfill suggested that there was enough liquidity in the market to cushion the shock of a possible mass selling action in the market.
“Bitcoin has maintained a daily trading volume of $8.74 billion on trusted exchanges this year, suggesting that there is sufficient liquidity to absorb these sales over the summer months,” Butterfill said. .
According to Jacob Joseph, research analyst at CCData, markets are more than capable of absorbing the selling pressure.
“In addition, a good portion of creditors are likely to take a 10% haircut on their holdings to receive early repayment, and not all holdings are intended to be liquidated on the open market, which reduces selling pressure overall,” he said.
Recent price movements suggest the temporary impact of Mt. Gox refunds may already be priced in, Joseph added.
Alex Thorn, head of research at Galaxy Digital, believes that fewer coins will be distributed than previously thought, meaning there will be less selling pressure than the market is expecting.
However, he also wrote in May that even if only 10% of distributed bitcoins were sold, “it would have an impact on the market.”
“Most individual creditors will deposit their coins directly into a trading account at an exchange, making selling extremely easy,” Thorn said.
Vijay Ayyar, head of consumer growth for Asia Pacific at cryptocurrency exchange Gemini, said the overall impact of the Mt. Gox disbursement should be “dissipated,” given the recipients of the funds are varied.
On one side, there are individual holders who will receive their bitcoins immediately. On the other side, there is the “significant amount” of bitcoins that will be paid into the claims funds, Ayyar said.
“These funds should then be distributed to their LPs [limited partners]therefore, the whole process could take some time, adding an element of time to the impact on price,” he told CNBC.
Macroeconomic headwinds behind bitcoin’s fall
It is worth noting that there are many other reasons behind bitcoin’s recent declines.
The cryptocurrency saw a dramatic rise earlier this year, exceeding $70,000 on the heels of the U.S. Securities and Exchange Commission’s approval of the first bitcoin cash ETF.
Stock Chart IconStock Chart Icon
Bitcoin price performance in US dollars since the beginning of the year.
But investors remained concerned over Bitcoin ETF outflows and significant market sell-offs. The broader macroeconomic environment is also worrying investors.
Earlier this month, the Federal Reserve suggested it planned to cut rates just once this year, down from multiple cuts previously announced.
Cryptocurrencies, by nature volatile, are particularly sensitive to changes in the interest rate environment.
CoinShares’ Butterfill said the Fed’s new rate forecasts were among “the likely culprits behind the recent price decline” in bitcoin.
This and other issues “are likely to weigh on prices during the summer months when volumes are lower,” Butterfill said. However, “the fundamental case for investment remains largely intact,” he added.
Over the past 24 hours, Jupiter and JasmyCoin emerged as the top gainers among the top 100 crypto assets, while Bittensor and Mantra plunged as the top losers.
Top Winners
Jupiter
Jupiter (JUP) led the charge among the biggest gainers on July 27.
At the time of writing, the crypto asset had surged 12.6% in the past 24 hours and was trading at $1.16. JUP’s daily trading volume was hovering around $282 million, according to data from crypto.news.
JUP Hourly Price Chart, July 26-27 | Source: crypto.news
Additionally, the cryptocurrency’s market cap stood at $1.56 billion, making it the 62nd largest crypto asset, according to CoinGecko. Despite the recent price surge, the token is still down 42.6% from its all-time high of $2 reached on Jan. 31.
Jupiter functions as a decentralized exchange aggregator that allows users to trade Solana-based tokens. The platform also offers users the best routes for direct trades between multiple exchanges and liquidity pools.
In addition to being a DEX aggregator, Jupiter has expanded into a “full stack ecosystem” by launching several new projects, including a dedicated pool to support perpetual trading and plans for a stablecoin.
JasmyCoin
JasmyCoin (JASMI) has increased by 12% in the last 24 hours and is trading at $0.0328 at press time. JASMY’s daily trading volume has increased by 10% in the last 24 hours, reaching $146 million.
JASMY Hourly Price Chart, July 26-27 | Source: crypto.news
The asset’s market cap has surpassed the $1.5 billion mark, making it the 60th largest cryptocurrency at the time of reporting. However, the self-proclaimed “Bitcoin of Japan” is still down 99.3% from its all-time high of $4.79 on February 16, 2021.
JASMY is the native token of Jasmy Corporation, a Japanese Internet of Things provider. The platform seeks to merge the decentralization of blockchain technology with IoT, allowing users to convert their digital information into digital assets.
The initiative was launched by Kunitake Ando, former COO of Sony Corporation, along with Kazumasa Sato, former CEO of Sony Style.com Japan Inc., Hiroshi Harada, executive financial analyst at KPMG, and other senior executives from Japan.
Kaspa
Kaspa (KAS) saw a 100% increase in trading volume and an 8% increase in price over the past 24 hours, trading at $0.19 at the time of publication.
KAS Hourly Price Chart, July 26-27 | Source: crypto.news
According to data from CoinGecko, Kaspa now ranks 27th in the global cryptocurrency list, with a circulating supply of approximately 24.29 billion KAS tokens and a market capitalization of $4.59 billion.
Kaspa is a cryptocurrency designed to deliver a high-performance, scalable, and secure blockchain platform. Its unique Layer-1 protocol includes the GhostDAG protocol, a proof-of-work (PoW) consensus mechanism that enables faster block times and higher transaction throughput compared to standard blockchains.
Unlike Bitcoin, GhostDAG allows multiple blocks to be created simultaneously, speeding up transactions and increasing block rewards for miners.
Bonk
Bonk (BONK) is the only one coin meme which made it to this list of biggest gainers and jumped 8.6% in the last 24 hours. Trading at $0.000030, the Solana-based meme coin’s market cap has surpassed $2.1 billion, surpassing Floki (FLOKI), another competing dog-themed coin with a market cap of $1.78 billion.
BONK Hourly Price Chart, July 26-27 | Source: crypto.news
BONK’s daily trading volume hovered around $285 million. However, BONK is still down 33.5% from its all-time high of $0.000045, reached on March 4.
Bonk, a meme coin that rose to prominence in 2023, has contributed significantly to Solana’s value increase amid the meme coin frenzy.
Bonk started out as a simple dog-themed coin. It has since expanded its features to include integration with decentralized finance. The project also partners with cross-chain communication protocols, NFT marketplaces, and various other cryptocurrency ecosystems.
BONK trading pairs are now listed on major exchanges including Binance, Coinbase, OKX, and Bitstamp.
The big losers
Bittensor
Bittensor (TAO) was the biggest loser among the 100 largest crypto assets, according to data from CoinGecko.
At the time of writing, TAO, the native token of decentralized AI project Bittensor, was down 5%, trading around $344. The crypto asset had a daily trading volume of $59 million and a market cap of $2.43 billion.
TAO 24 Hour Price Chart | Source: CoinGecko
Bittensor, created in 2019 by AI researchers Ala Shaabana and Jacob Steeves, initially operated as a parachain on Polkadot before transitioning to its own layer-1 blockchain in March 2023.
Mantra
Mantra (OM) fell 6%, trading at $1.13 at press time. The digital currency’s market cap fell to $938 million. Additionally, the 82nd largest crypto asset has a daily trading volume of $26 million.
OM Price Hourly Chart, July 26-27 | Source: crypto.news
Mantra is a modular blockchain network comprising two chains, Manta Pacific and Manta Atlantic, specialized in zero-knowledge applications.
Coat
Coat (MNT) also saw a 2.4% drop in price, now trading at $0.8413. Currently, Mantle has a market cap of around $2.75 billion, which ranks 36th in the global cryptocurrency rankings by market cap, according to price data from crypto.news.
MNT Hourly Price Chart, July 26-27 | Source: crypto.news
Over the past 24 hours, MNT trading volume also fell by 6%, reaching $240 million.
Mantle, formerly known as BitDAO, is an investment DAO closely associated with Bybit. The MNT token is essential for governance, paying gas fees on the Mantle network, and staking on various platforms.
Built on the Ethereum network, Mantle provides a platform for decentralized application developers to launch their projects. It has become particularly popular for GameFi applications, leading to the formation of an internal Web3 gaming team.
Markets
Bitcoin Price Drops to $67,000 Despite Trump’s Pro-Crypto Comments, Further Correction Ahead?
Pioneer cryptocurrency Bitcoin has registered a 1.13% decline in the past 24 hours to trade at $67,400. Despite a strong pro-crypto stance from US presidential candidate Donald Trump at the Bitcoin 2024 conference, this massive selloff has raised concerns in the market about the asset’s sustainability at a higher price. However, given the recent three-week rally, a slight pullback this weekend is justifiable and necessary to regain the depleted bullish momentum.
Bitcoin Price Flag Formation Hints at Opportunity to Break Beyond $80,000
The medium-term trend Bitcoin Price remains a sideways trend amidst the formation of a bullish flag pattern. This chart pattern is defined by two descending lines that are currently shaping the price trajectory by providing dynamic resistance and support.
On July 5, BTC saw a bullish reversal from the flag pattern at $53,485, increasing its asset by 29.75% to a high of $69,400. This recent spike followed the market’s positive sentiment towards the Donald Trump speech at the Bitcoin 2024 conference in Nashville on Saturday afternoon.
Bitcoin Price | Tradingview
In his speech, Trump outlined several pro-crypto initiatives: he promised to replace SEC Chairman Gary Gensler on his first day in office, to establish a Strategic National Reserve of Bitcoin if elected, to ensure that the U.S. government holds all of its assets. Bitcoin assets and block any attempt to create a central bank digital currency (CBDC) during his presidency.
He also claimed that under his leadership, Bitcoin and cryptocurrencies will skyrocket like never before.
Despite Donald Trump’s optimistic promises, the BTC price failed to reach $70,000 and is currently trading at $67,400. As a result, Bitcoin’s market cap has dipped slightly to hover at $1.335 trillion.
However, this pullback is justified, as Bitcoin price has recently seen significant growth over the past three weeks, which has significantly improved market sentiment. Thus, price action over the weekend could replenish the depleted bullish momentum, potentially strengthening an attempt to break out from the flag pattern at $70,130.
A successful breakout will signal the continuation of the uptrend and extend the Bitcoin price forecast target at $78,000, followed by $84,000.
On the other hand, if the supply pressure on the upper trendline persists, the asset price could trigger further corrections for a few weeks or months.
Technical indicator:
- Pivot levels: The traditional pivot indicator suggests that the price pullback could see immediate support at $64,400, followed by a correction floor at $56,700.
- Moving average convergence-divergence: A bullish crossover state between the MACD (blue) and the signal (orange) ensure that the recovery dynamics are intact.
Related Articles
Frequently Asked Questions
A CBDC is a digital form of fiat currency issued and regulated by a country’s central bank. It aims to provide a digital alternative to traditional banknotes.
The proposal for a strategic national Bitcoin reserve is a major confirmation of Bitcoin’s legitimacy and potential as a reserve asset. Such a move could position Bitcoin in a similar way to gold, potentially stabilizing its price and encouraging other countries to adopt similar strategies.
Conferences like Bitcoin 2024 serve as essential platforms for networking, knowledge sharing, and showcasing new technologies within the cryptocurrency industry.
Markets
Swiss crypto bank Sygnum reports profitability after surge in first-half trading volumes – DL News
- Sygnum says it has reached profitability after increasing transaction volumes.
- The Swiss crypto bank does not disclose specific profit figures.
Sygnum, a Swiss global crypto banking group with approximately $4.5 billion in client assets, announced that it has achieved profitability after a strong first half, with key metrics showing year-to-date growth.
The company said in a Press release Compared to the same period last year, cryptocurrency spot trading volumes doubled, cryptocurrency derivatives trading increased by 500%, and lending volumes increased by 360%. The exact figures for the first half of the year were not disclosed.
Sygnum said its staking service has also grown, with the percentage of Ethereum staked by customers increasing to 42%. For institutional clients, staking Ethereum has a benefit that goes beyond the limitations of the ETF framework, which excludes staking returns, Sygnum noted.
“The approval and launch of Bitcoin and Ethereum ETFs was a turning point for the crypto industry this year, leading to a major increase in demand for trusted, regulated exposure to digital assets,” said Martin Burgherr, Chief Client Officer of Sygnum.
He added: “This is also reflected in Sygnum’s own growth, with our core business segments recording significant year-to-date growth in the first half of the year.”
Sygnum, which has also been licensed in Luxembourg since 2022, plans to expand into European and Asian markets, the statement said.
Markets
Former White House official Anthony Scaramucci says cryptocurrency bull market could be sparked by regulatory clarity
Anthony Scaramucci, founder of Skybridge Capital, says the next cryptocurrency bull market could be sparked by a new wave of clear cryptocurrency regulations.
In a new interview On CNBC’s Squawk Box, the former White House communications director said he and two other prominent industry figures traveled to Washington, D.C. to speak to officials about the dangers of Sen. Elizabeth Warren and U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler’s hardline approach to cryptocurrency regulation.
“Mark Cuban, myself, and Michael Novogratz were in Washington a few weeks ago to speak with White House officials and explain the dangers of Gary Gensler and Elizabeth Warren’s anti-crypto approach. I hope that message gets through…
“Overall, if we can get regulatory policy around Bitcoin and crypto assets in sync, we will have a bull market next year for these assets.”
Scaramucci then compares crypto assets to ride-hailing company Uber, saying regulators were initially wary of the service but eventually decided to adopt clear guidelines due to public demand.
“Remember Uber: Nobody wanted Uber. A lot of regulators didn’t want it. Mayors and deputy mayors didn’t want it, but citizens wanted Uber and eventually accepted the idea of regulating it fairly. I think we’re there now.”
The CEO also says young Democratic voters believe their leaders are making the wrong choices when it comes to digital assets.
“I think President Trump’s move toward Bitcoin and crypto assets has shaken Democrats to their core, and I think very smart, younger Democrats are recognizing that they are completely off base with their positions, completely off base with these SEC lawsuits and regulation by law enforcement, and now they need to get back to the center.”
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