Yesterday a wallet that had recently received 2.19 billion dollars in Bitcoin from the exchange Mt.Gox started to move its funds.
Arkham Intelligence reported the news, according to which that wallet would be that of the crypto exchange BitGo.
JUST IN: MOVEMENTS FROM $1.95B MT GOX BTC WALLET
A Wallet that received $2.19B Bitcoin from Mt. Gox has just initiated test transactions.
This wallet bc1q26 is likely Bitgo, the 5th and final exchange working with Mt. Gox Trustee to distribute funds to Mt. Gox creditors.
Are… pic.twitter.com/w0j2aCg2Gc
— Arkham (@ArkhamIntel) August 13, 2024
Wallet news: the distribution of the exchange Mt.Gox
Mt.Gox is the well-known crypto exchange that failed in 2014.
Starting from July, it began the distribution of its 142,000 BTC to its creditors.
The procedure chosen by the Japanese bankruptcy trustee, in agreement with the bankruptcy court, is not to distribute these BTC directly to the non-custodial wallets of the creditors.
In fact, such a distribution procedure requires KYC, in order to ensure that the refunds are actually received by the creditors, and not others.
The choice fell on some centralized exchanges, including Kraken and BitGo, where KYC is mandatory.
In this way, it is the exchange that ensures that the identities of the recipients of the distribution of BTC from Mt.Gox are indeed those of the individual creditors who are entitled to receive them.
Therefore, the bankruptcy trustee of Mt.Gox does not send the Bitcoin directly to the creditors, but sends them to the exchanges where the creditors are registered, also giving them instructions on how they should then be distributed to the individual creditors.
The distribution to creditors
As of today, according to data from Arkham Intelligence, approximately 96,000 BTC have already been withdrawn from the wallet of Mt.Gox, out of the initial 142,000.
The first exchange to have received them seems to have been Kraken, at the end of July.
According to the data from Arkham Intelligence, they were received by the exchange on July 17, but would have been distributed to creditors only starting from the 24th of the same month.
Before receiving the BTC from Mt.Gox, Kraken held approximately 169,000 Bitcoin, which became 216,000 after the reception on July 17.
Given that they now amount to 185,000, it is plausible to believe that of the approximately 47,000 BTC received, 31,000 were withdrawn by creditors from the exchange in the following days, while about 16,000 are still there.
The other exchanges participating in the distribution of BTC from Mt.Gox are Bitbank, BitGo, Bitstamp, and SBI VC Trade.
BitGo
On Reddit, some users of the Mt.Gox creditors’ channel have indeed reported receiving funds in their BitGo accounts.
Therefore, the movement from yesterday detected by Arkham Intelligence could actually be the beginning of the actual distribution of Mt.Gox’s BTC to creditors on the crypto exchange.
It should be remembered that although all on-chain Bitcoin transactions are public, the addresses are anonymous, so it is not always possible to give them a name.
Although Arkham Intelligence manages to map many thousands of addresses whose owner is known, exchanges in turn use hundreds, if not thousands, of different addresses. It is practically impossible to know all the public addresses used by all the exchanges.
In this specific case Arkham Intelligence supposed that the mapped address belonged to BitGo, and the confirmations on Reddit are a strong clue that this supposition could be correct.
The impact on the price
When Mt.Gox started moving large amounts of BTC on July 17, the price of Bitcoin did not move significantly.
This suggests that the markets do not expect widespread sales of the BTC cashed in by the creditors of Mt.Gox.
On the other hand, after 10 years of waiting, during which their market value has appreciated by 6,000%, it is plausible to imagine that many of those who will receive them might decide to keep them in their portfolio for other years.
The drop in the price of Bitcoin began on July 29 after reaching $70,000. This dynamic does not seem to be related to the distribution of Mt.Gox.
On August 4th, the latest crash began, which brought the price of Bitcoin below $50,000 the following day.
On July 31, approximately 34,000 BTC had been sent from Mt.Gox to the exchanges, and this is compatible with a subsequent distribution to creditors at the beginning of August.
However, by August 9, all the losses from the crash of August 4 and 5 had already been absorbed. A factor that leans more towards a temporary crash due to the general conditions of the financial markets, rather than the distribution of Mt.Gox.
Furthermore, yesterday’s news did not cause any drop. The current price of Bitcoin is perfectly in line with that of July 14, before the BTC transfers from the Mt.Gox wallet began.
