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A recent report published by market strategists from investment bank and finance company UBS says the upcoming Mt Gox payouts will not destabilize bitcoin’s value. While a new supply will come to market, UBS strategists insist that “it would be less concentrated.”
UBS market strategists believe that the cause for concern over the upcoming Mt Gox distribution of 142,000 bitcoin (BTC) may be slightly overhyped relative to the “longstanding fear that Mt. Gox redemptions would hurt bitcoin’s price.”
Bitcoin.com News reported on the Mt Gox rehabilitation plan approaching the end of the road at the end of October 2022. Through the current plan, creditors have several options to choose from when it comes to repayments.
Creditors have until March 10 to choose a repayment plan, and payouts are expected around September 2023. The 142,000 bitcoin (BTC) today is worth more than $3.36 billion using current exchange rates.
“The most important ones are, firstly, whether to take an early lump sum or wait for further proceedings and further recovery of assets, and secondly, to receive funds in fiat or crypto,” explained UBS strategists James Malcom and Ivan Kachkovski.
The UBS executives added:
New supply may still enter the market, but this at least means that it will be less concentrated.
There is also a holding of 142,000 bitcoin cash (BCH) worth over $19 million and $510 million or 69 billion Japanese yen in cash. Users who wish to be paid in crypto must sign up and register with a chosen centralized crypto exchange to handle the refund option.
Creditors who choose this route must submit basic KYC/AML information to leverage a crypto exchange in order to be reimbursed. While it may not be significant, the UBS strategists noted that there is still potential for fluctuations in Bitcoin’s value during the payout of Mt. Gox Bitcoin.
“It is certainly difficult to estimate the extent to which the market has priced massive sales from Mt Gox. However, we believe that such news may have been an additional factor in what we believe may be mainly retail-led – Bitcoin’s surprising resilience of late,” Kachkovksis and Malcolm’s note concluded.
Do you agree with UBS strategists’ prediction that the upcoming Mt Gox payouts will have minimal impact on bitcoin’s value? Or do you think there is a chance for more significant swings? Let us know your thoughts in the comments section below.
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