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Drops Below $55K as Mt Gox Begins Repayments to Creditors By Investing.com
Investing.com: The price fell sharply on Friday, hitting a four-month low, extending a recent price slump as defunct cryptocurrency exchange Mt Gox began repaying creditors.
Additionally, German police were seen moving around $75 million in cryptocurrency confiscated from a piracy website to exchanges, potentially heralding a mass sell-off event like the one seen earlier this year and helping fuel negative sentiment.
Bitcoin has slipped 4.9% in the past 24 hours to $54,931.7, its weakest level since February. The token has also fallen nearly 11% in the past seven days.
Mt Gox starts issuing refunds
The sharp drop in the price of Bitcoin comes as investors have turned their attention to the nearly $9 billion payout to users of the defunct bitcoin exchange Mt. Gox.
Nobuaki Kobayashi, the bankruptcy trustee overseeing Mt. Gox’s bankruptcy estate, announced that bitcoin and bitcoin cash refunds had begun to some creditors through several designated cryptocurrency exchanges. However, he did not specify the exact amount of money transferred to these exchanges.
Kobayashi explained that the remaining funds will be distributed to creditors once certain conditions are met, including the validation of registered accounts and the completion of discussions between the trustee and the designated cryptocurrency exchanges.
He stressed that efforts are underway to ensure that repayments are made “safely and securely” and urged “creditors eligible for rehabilitation to wait a little while.”
The announcement follows the movement of a small amount of bitcoin from wallets linked to Mt. Gox, as reported by blockchain analytics firm Arkham Intelligence. The largest movement recorded was a $24 transfer to Japanese cryptocurrency exchange Bitbank, which is among the platforms that support refunds.
Fears of further sales by the German police also weighed.
Cryptocurrency Price Today: Political Uncertainty, Rate Nervousness Impact Prices
Cryptocurrency prices in general have followed Bitcoin’s sharp declines, with uncertainty over the US presidential election and interest rates contributing to weak sentiment towards cryptocurrencies.
Speculation that President Joe Biden may drop out as the Democratic nominee for the 2024 election has sparked uncertainty in cryptocurrency markets, especially amid fears that Biden will be replaced by an even more crypto-averse candidate.
Furthermore, uncertainty ahead of a key U.S. reading has kept traders averse to cryptocurrencies, even as they have fallen on rising expectations of a September interest rate cut.
Cryptocurrency markets have largely lagged the rally in stocks they typically follow.
The world’s No. 2 token slid 7.7% to $2,920.54, erasing all the gains made in late May and hitting a near two-month low.
and have dropped between 3% and 13%, while among meme tokens, and have lost about 11% each.
The losses were partly driven by low trading volumes due to the U.S. Fourth of July holiday. But they also reflected steadily declining sentiment toward cryptocurrencies, as excitement over the approval of a spot Bitcoin exchange-traded fund fizzled out.
Overall, the cryptocurrency market has lost more than $170 billion in market capitalization in the past 24 hours, according to data from CoinGecko.
Cryptocurrency Stocks Follow Bitcoin’s Drop
In addition to altcoins, cryptocurrency-related stocks also followed Bitcoin’s decline on Friday.
MicroStrategy Incorporated (NASDAQ:), the largest publicly traded company holding Bitcoin, saw its shares plunge more than 9%.
Similarly, bitcoin miners Riot Platforms (NASDAQ:) and Marathon Digital Holdings Inc (NASDAQ:) fell 7% and 6.3%, respectively.
Additionally, shares of CleanSpark Inc (NASDAQ:) fell more than 4.6%, Cipher Mining Inc (NASDAQ:) slipped 8.6% and Coinbase Global Inc (NASDAQ:) lost 6%.