At least some Mt. Gox creditors expect to receive repayments within the next seven to 14 days, according to an email Kraken sent to users.
Kraken is one of five cryptocurrency exchanges, including Bitstamp, that are working with the Mt. Gox trustee to facilitate the distribution of BTC to creditors of the defunct exchange.
The exchange confirmed that the email, which circulated on Twitter, was authentic. But Kraken did not comment on whether its distribution was consistent with distributions from other coordinated exchanges.
"As we stated in our email, we have asked customers to expect funds to be in their accounts within the next 7-14 days," a spokesperson told Decrypt.
Mt. Gox, once the world’s largest bitcoin exchange, will repay billions of dollars worth of bitcoin to creditors after it collapsed more than a decade ago following a massive hack and a series of legal problems.
“We have successfully received creditor funds (in Bitcoin and Bitcoin Cash) from the Mt. Gox trustee,” Kraken wrote in an email to creditors. “Funds will be deposited into your account in an estimated 7-14 days.”
Earlier this month, Bitstamp told Decrypt that its agreement with the Mt. Gox trustee gives the company up to 60 days to distribute BTC to creditors. However, Bitstamp said it would make the payments “as quickly as possible.”
This morning, the price of Bitcoin fell rapidly after a trustee wallet moved $2.8 billion to a cold wallet. The wallet later moved $3 billion of the funds to an unidentified wallet. As of this writing, Bitcoin is trading at $63,914.15, up 2% since this time yesterday, according to CoinGecko.
Notably, Kraken’s transfers and creditor emails occurred on the 14th anniversary of Mt. Gox’s first transaction.
Back in 2014, the company lost 850,000 bitcoins due to a breach. At least 90% of the lost bitcoins belonged to customers. It is not clear how much bitcoin will be returned to creditors, but it is unlikely that all 850,000 bitcoins will be distributed.
Kraken said in an email that the Mt. Gox trustee has determined how much each creditor will receive, but did not disclose the total planned distribution.
Market participants expect creditors to sell at least some of the returned bitcoins, one of many factors that have contributed to the recent decline in the cryptocurrency market.
“At first glance, these amounts seem much larger, but we should not forget that not all of this crypto is available for sale,” Alex Kuptsikevich, senior market analyst at FxPro, told Decrypt. “The money will go to early crypto enthusiasts rather than to the authorities who are legally required to sell BTC. I would not be surprised if the actual transfer volume from crypto to fiat is in the region of 20-30%.”
We believe that the end of the Mt. Gox incident and the sale of seized assets by the German government “likely” marks a bottom for Bitcoin.
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