Bitcoin

8,200 Bitcoins from Mt. Gox Wallet Moved in the Last 24 Hours – Price Decline

8,200 Bitcoins from Mt. Gox Wallet Moved in the Last 24 Hours - Price Decline

Cryptocurrency exchanges have seen thousands of Bitcoin dumped on the open market in the past week, seemingly originating from the Mt. Gox wallet. This type of cryptocurrency sell-off can severely impact the market price of the coins and is potentially only the beginning – as the Mt. Gox wallet still has a massive amount of Bitcoin left to offload.

Following the bankruptcy of the cryptocurrency exchange, a trustee was put in charge of disposing of the approximately 200,000 Bitcoin which were still in the firm’s possession. It would seem that a portion of this has now been sold off, as four of the Mt. Gox trustee’s wallets have recently realized a grand total of 8,000 Bitcoin during less than 24 hours. However, although a significant amount on its own, this represents less than 5% of the 200,000 BTC that Japanese authorities ordered the Mt. Gox trustee to convert into Japanese yen.

Ledger Nano S - The secure hardware wallet

It would seem that the Mt. Gox trustee is trading the Bitcoin on open cryptocurrency exchanges. Traditionally, trustees looking to sell this magnitude of assets most often do so through the ”OTC”, or over-the-counter market. This allows a trustee to make deals with retail or institutional investors so that large amounts of Bitcoin could be offloaded without majorly affecting the open markets. However, since the trustee seems to be taking to open cryptocurrency exchanges to sell off the Mt. Gox Bitcoin, this can lead to a significant drop in the open cryptocurrency market.

CNN recently reported on the issue of whether or not more financial institutions and banks will adopt cryptocurrency trading. CNBC’s Brian Kelly highlighted that the potential entry of such traditional actors would allow the cryptocurrency market to increase rapidly in value. Moreover, it would also indirectly cause cryptocurrencies to be regarded as an ”emerging asset class”. Kelly also went on to discuss the fact that the cryptocurrency market is highly volatile.

This is mostly due to the fact that the cryptocurrency trading volume per day is relatively low compared to trading in gold, or NASDAQ trades. This puts the cryptocurrency market at a greater risk for the type of major sell-off that the Mt. Gox trustee is currently conducting. If large amounts of Bitcoin are put up for sale on open cryptocurrency exchanges, this can lead to a drastic drop in Bitcoin valuation – which, in turn, can lead to seemingly irrational fluctuations in the cryptocurrency’s valuation.

Image Source: “Flickr”

Ledger Nano S - The secure hardware wallet

Rasmus Pihl is a writer for Toshi Times by day and an avid follower of the cryptocurrency industry by night. Rasmus holds a Bachelor’s Degree in Marketing from the Gothenburg School of Business, Economics, and Law and runs a Swedish marketing consulting firm. Moreover, when he isn’t writing for Toshi Times, traveling, working or changing the world in some other capacity, Rasmus is more than likely caught up in postgraduate studies.