Mt. Gox Gears Up to Pay Creditors. Moves About $9 Billion in Bitcoin

Defunct crypto exchange Mt. Gox made a move for the first time in five years, transferring over 140,000 bitcoin (BTC) through different transactions from its cold wallet to a new wallet. According to valuations at press time, approximately $9 billion in BTC was transferred.

The subject transfer caused Bitcoin’s price to drop from $70,600 to $68,500 on Monday. According to Coingecko data, Bitcoin is currently selling for $67,000. 

Mt. Gox’s recent transfers follow a five-year break with no record of asset movement. Market participants speculate that the recent sell-off seems to be a move toward Mt. Gox’s plans to pay back its debt to its creditors before October 31, 2024.

Mt. Gox Goes Bankrupt Following Cyber Attacks

Jed McCaleb, the co-founder of Stellar Development Foundation and former Ripple CTO, first launched Mt. Gox in 2010 before selling the company to Mark Karpeles in 2011. 

That same year, the company experienced a security breach that caused it to lose more than 850,000 BTC to invalid addresses, although it could redeem about 200,000 BTC. At that time, the stolen assets were worth around $450 million.

Before the security breach, Mt. Gox handled around 70% of all Bitcoin transactions and executed about 150,000 transactions daily. However, after suffering several security breaches according to the platform and going through failed business plans in addition to lawsuits filed against Mt. Gox, the company had to file for bankruptcy in February of 2014, causing Bitcoin to fall from over $600 to around $100 in just a few seconds.

Japanese authorities charged CEO Karpeles with embezzlement and data manipulation following the company’s bankruptcy. Although the court acquitted him of those two charges, it later convicted him in 2019 of falsifying data. The court sentenced Karpeles to two and a half years in a Japanese prison to punish him for his crime.

Authorities have moved the date for the platform’s reimbursement to its creditors to October 31, 2024. The recent asset movements on Mt. Gox’s wallet address are probably a move towards meeting the creditor’s reimbursement target.

Similar to how Mt. Gox’s collapse caused a decline in Bitcoin’s value, Solana also experienced a 5% price correction following the closure of FTX.