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Bitcoin’s crabwalk could extend into September, as Mt. Gox and the US government threaten to add nearly $15 billion worth of additional selling pressure.
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Bitcoin’s sluggish momentum could carry over into September, as Mt. Gox and the United States Government could introduce nearly $15 billion worth of additional selling pressure.
Over $14.8 billion worth of Bitcoin (BTC) could soon flood the market and put more downward pressure on price.
The US government holds over 203,000 Bitcoin worth $12.1 billion, while defunct crypto exchange Mt. Gox is set to distribute another 46,000 Bitcoin worth over $2.7 billion.
Bitcoin selling pressure. Source: Kaiko
Mt. Gox is set to distribute the $2.7 billion before the end of 2024 on Kraken, but the repayments are unlikely to cause a significant market impact, according to an Aug. 29 report by crypto analytics provider Kaiko:
“Kraken has handled BTC ETF flows with just a minor increase in slippage at the US market close. Its liquidity profile suggests that any additional selling pressure from the Mt. Gox repayments is unlikely to cause structural issues that could affect the broader market.”
Mt. Gox creditors have been waiting to receive over $9.4 billion worth of Bitcoin for the past 10 years, which has since appreciated over 8,500% in value, meaning that numerous investors will likely look to sell.
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Mt. Gox creditors have not sold during the last major $4b distribution
Despite Bitcoin’s significant price appreciation, Mt. Gox creditors have not been selling.
Mt. Gox creditors received nearly $4 billion worth of BTC at the end of July, marking 41.5% of the payments owed to users.
Yet, most Mt. Gox creditors opted not to sell, according to a July 29 Glassnode report.
“Creditors opted to receive BTC, rather than fiat, which was new in Japanese bankruptcy law […] As such, it is relatively likely that only a subset of these distributed coins will be truly sold onto the market.”
BTC: Mt. Gox trustee outflows. Source: Glassnode
Notably, the spot cumulative volume delta (CVD), a metric that measures the net difference between spot buying and selling trade volume on centralized exchanges, has seen no significant uptick on Karken after the Mt. Gox BTC distribution.
Bitcoin CVD, Kraken exchange. Source: Glassnode
Related: Celsius distributes $2.5B to 251,000 creditors amid bankruptcy proceedings
Bitcoin price remains subdued under $60,000
Meanwhile, Bitcoin price remains subdued under the $60,000 psychological mark after falling over 10.7% on the monthly chart.
BTC/USD, 1-day chart. Source: TradingView
To close August in the green, Bitcoin needs a monthly close above $64,300.
Analysts warned that the lack of liquidity characteristic of the summer could carry on into September, making it difficult for Bitcoin to overcome the $63,900 resistance, according to Bitfinex analysts, who told Cointelegraph:
“Price is a reflection of historical market transactions; we must look under the hood. Price rallied up to the Short Term Holder (STH) realized price of around $63,900 currently, and thus, we also saw some profit-taking from the STH cohort.”
Bitcoin’s average returns for the month of September were negative at -4.78% since 2013, added the analysts.
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This article first appeared at Cointelegraph.com News
