JPMorgan predicts the cryptocurrency market could see a wave of sell-offs in July as creditors of Mt. Gox received back 142,000 Bitcoin, equivalent to 9 billion USD.
In a research report published on June 27, JPMorgan (JPM) warned that the cryptocurrency market could face strong selling pressure in July, stemming from the exchange's creditors. Bitcoin (BTC) Mt. Gox is expected to receive a huge amount of BTC in return.
Accordingly, the trustee of the Mt. Gox announced earlier this week that it will repay creditors in July. JPMorgan noted the announcement has caused instability in the cryptocurrency market due to fears that some creditors will sell off their Bitcoins as soon as they receive them. It is estimated that creditors will receive back a total of 142,000 Bitcoin, equivalent to about 9 billion USD at current market value.
Concern covers the virtual currency market
JPMorgan's analyst team, led by Nikolaos Panigirtzoglou, commented: “This fear is well-founded based on the recent actions of Gemini creditors, which are said to have liquidated part of their crypto assets. been in recent weeks.” Previously, on May 29, Gemini announced that Gemini Earn users had received all their digital assets back after resolving issues with Genesis.
Although the deadline for creditors of Mt. Gox refunds were due in October, JPMorgan forecasts the majority of refunds will take place in July. If this happens, the report concludes, the cryptocurrency market could see a wave of selling unwind next month before rebounding again in August.
Impact from FTX bankruptcy
Besides, JPMorgan reports, the cash payment to creditors of the FTX cryptocurrency exchange, expected to take place after October 7, could bring a positive impact to the market. school. But the three-month gap between the potential sale by creditors of Mt. Gox and the reinvestment of FTX creditors later this year is a factor that could support the market
Overall, JPMorgan's report shows that the cryptocurrency market is entering a period of unpredictable fluctuations, influenced by many complex factors. Investors need to be cautious and closely monitor market developments to be able to make timely decisions.
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