Mt.Gox transfers $2.7 billion in BTC to new wallet address, causing market crash

Author: Tom Mitchelhill, CoinTelegraph; Compiler: Wuzhu, Golden Finance

The collapsed Japanese cryptocurrency exchange Mt. Gox has moved 47,229 bitcoins (worth $2.71 billion at current prices) to a new wallet address, the first major transaction since May.

According to blockchain analysis platform Arkham Intelligence, the exchange moved the bitcoins out of its "cold storage" wallet at 12:30 a.m. UTC on July 5.

Mt. Gox has conducted several smaller test transactions in recent months. Source: Arkham Intelligence

The move comes as the exchange plans to begin repaying creditors this month. A total of $8.5 billion worth of Bitcoin will be repaid to creditors.

Mt. Gox trustee Nobuaki Kobayashi issued a statement on June 24 saying that Mt. Gox has notified creditors that it has completed all necessary steps and will begin repaying debts in July.

Mt. Gox trustee Nobuaki Kobayashi said creditors will start paying back debts in November

Several market commentators have expressed concerns about the amount of Bitcoin that could hit the market after Mt. Gox creditors sell their holdings, which they have held for more than a decade.

However, other analysts have sought to allay fears of a massive sell-off, saying the total value of Bitcoin "dumped" on the market could be closer to around $4.5 billion.

Alex Thorn, head of research at Galaxy Digital, said Mt. Gox speculated that many Mt. Gox Bitcoin holders would be more "generous" than expected, noting that capital gains taxes could have an adverse impact on sellers who wanted to sell all of their BTC at once.

On May 28, Mt. Gox transferred nearly $7.3 billion worth of Bitcoin to another unknown wallet address. Bitcoin prices subsequently fell 2%.

Bitcoin fell 6.9% last week. Source: TradingView

According to data from TradingView, the price of Bitcoin fell sharply on July 4 and then plummeted in the following hours.

The price of Bitcoin fell 6.9% this week, but is up 35.6% year to date.