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Mt. Gox’s Creditors Opt for Bitcoin Payments: Alleviating Long-Term Concerns for Bitcoin Holders

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According to reports, according to people familiar with the matter, the two largest creditors of Mt. Gox, a crypto exchange that collapsed nine years ago due t…

Mt. Gox’s Creditors Opt for Bitcoin Payments: Alleviating Long-Term Concerns for Bitcoin Holders

According to reports, according to people familiar with the matter, the two largest creditors of Mt. Gox, a crypto exchange that collapsed nine years ago due to hacker attacks, have chosen to collect their claims mainly in Bitcoin (BTC). Bitcoinica and MtGox Investment Funds (MGIF), the cryptocurrency exchange headquartered in New Zealand, together account for about one fifth of the total claims of Mt. Gox, and will receive 90% of the recoverable funds. This decision may alleviate the long-term concern of Bitcoin holders that the liquidation related to the bankruptcy claim of Mt. Gox may put pressure on the price of Bitcoin, because if these two creditors choose to pay in legal currency, the trustee supervising the bankruptcy property may be forced to sell most of Bitcoin recovered by Mt. Gox to meet the payment requirements in legal currency.

Sources: The two largest creditors of Mt.Gox choose to collect their claims mainly in Bitcoin

Interpretation of the news:


Reports indicate that the two largest creditors of Mt. Gox, an infamous cryptocurrency exchange that collapsed in 2014 because of a series of hacker attacks, have decided to collect their claims mainly in Bitcoin. Bitcoinica and MtGox Investment Funds (MGIF), both headquartered in New Zealand, comprise around 20% of Mt. Gox’s total claims and will obtain 90% of the recoverable funds, according to anonymous sources familiar with the matter.

This development marks a departure from the norm where creditors would typically opt for payments made in fiat currency, such as the US dollar, especially in the aftermath of a widespread and well-known security breach. The decision to accept Bitcoin payments is a signal of the changing landscape in the cryptocurrency market.

The liquidation process that underlies the bankruptcy claim of Mt. Gox may have a significant impact on the price of Bitcoin since Bitcoin is the largest asset that the trustee supervising the bankruptcy property has recovered. If creditors require the payment to be made in fiat currency, the trustee would have to sell most of the recovered Bitcoins to meet these requirements. However, with the recent news that Bitcoinica and MGIF are willing to accept Bitcoin payments, this pressure on the price of Bitcoin may be alleviated.

The news of Bitcoin payments to Mt. Gox’s creditors is good news for long-term Bitcoin holders who have been concerned that the liquidation process could drive down Bitcoin’s value. It serves as a vote of confidence that Bitcoin is still a trusted cryptocurrency and an essential store of value.

In conclusion, the decision of Mt. Gox’s two largest creditors to accept payments mainly in Bitcoin is a significant development that highlights a changing landscape in the cryptocurrency market. This move also helps to allay the long-term concerns of Bitcoin holders that the liquidation process of Mt. Gox could negatively affect Bitcoin’s value.

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