Kim Nilsson Says Mt. Gox Creditor Payouts Could “Completely Crash the Market”?
Why Mt. Gox’s Payouts May ‘Completely Crash the Market’?
Mt. Gox was one of the most important cryptocurrency exchanges in the world. The company was hacked for over 800,000 BTC and it was not able to give back to its users the funds they had. According to an official document from the exchange, victims of the hack could claim 170,000 in BTC and BCH.
In order to make it easier for the affected users, Nobuaki Kobayashi, trustee of the legal process, uploaded a tool for claimants to start the process of issuing a claim. Creditors should submit legal documents and other information regarding their funds.
It is important to mention that corporate traders are also able to make claims through the same process as individual traders. This is quite positive, since in the past, only individuals could claim their funds back.
Users, both individual and corporate, have time until October 22nd to complete the claims. After that, the online tool and offline claiming processes will be closed.
After October’s deadline, the civil rehabilitation requests will have to be submitted to Japanese courts before February 14, 2019. After the judicial approval, Mt. Gox’s liquid assets will have to be distributed among the bona fide claimants.
However, some experts believe that these pay outs could cause a market crash due to a potential mass liquidation of funds.
Kim Nilsson is a former Mt. Gox trader that spoke with The Telegraph about this whole situation and the investigation about the exchange’s bankruptcy. He mentioned that if there is not demand to buy thousands of Bitcoin from the Mt. Gox case, the market could completely crash.
At the moment, order books are no able to support such an important selling pressure. The price of both Bitcoin and Bitcoin Cash would dramatically crash.
About it, he mentioned:
“It’s possible some people would try to instantly sell the Bitcoins as soon as they receive them, but it would probably be less than 100pc of the people doing it.”
The Mt. Gox case is taking a very long time to find a solution for investors that lost their funds several years ago. This could be one of the most important chances for users to recover the funds they had when the attack occurred.