A decade after the collapse of Mt. Gox, the exchange begins repaying bitcoin to creditors.

• Mt. Gox, the Japanese Bitcoin exchange that went bankrupt a decade ago, has started making payments to some of its creditors in Bitcoin and Bitcoin Cash, as announced by its trustee on Friday.
• The announcement states that prompt repayments to other users of the hacked exchange will be made once certain conditions are met.
• Tokyo-based exchange customers have been waiting 10 years to receive their refund.

Mt. Gox's trustee announced on Friday that the company has started making payments to some of its creditors in both bitcoin and bitcoin cash.

The bankruptcy estate will promptly repay other users of the hacked exchange if they meet certain conditions, such as account verification and subscription to a designated digital asset exchange.

Please wait for a moment, as we are requesting eligible rehabilitation creditors to hold off.

In the past day, the value of bitcoin has dropped by almost 6%.

Tokyo-based exchange customers have been waiting 10 years for their money to be returned.

What is Mt. Gox?

In February 2014, Mt. Gox, once the world's largest crypto trading platform, declared bankruptcy following a string of thefts that resulted in the disappearance of up to 950,000 bitcoin, worth approximately $58 billion at current market rates.

Mt. Gox claimed that a bug in the bitcoin framework caused the disappearance of coins, while users received incomplete transaction messages on the exchange. However, the company also admitted that hackers may have stolen coins from users' accounts.

Roughly $9 billion worth of bitcoin will be returned to owners after 140,000 missing bitcoin were recovered, with bitcoin trading at $600 at the time of bankruptcy and now worth over $54,000, resulting in an almost 9,000% increase.

On Thursday and Friday, Mt. Gox transferred billions of dollars in bitcoin from its digital wallets prior to the release of the repayment plan, according to information from Arkham Intelligence.

On Friday, Arkham Intelligence reported that over 47,000 bitcoins worth $2.7 billion were taken out of an offline cryptocurrency wallet linked to Mt. Gox.

Bitbank, a Japanese crypto exchange and a platform supporting Mt. Gox repayments, received $84.9 million of the funds, while an additional $63.6 million of bitcoin was sent to an unknown counterparty, likely a listed repayments exchange, according to Arkham.

According to Arkham, Mt. Gox wallets continue to hold 138,985 bitcoins, worth approximately $7.5 billion at current prices, indicating that billions of dollars worth of cryptocurrency remain unpaid.

How will this impact bitcoin?

The Mt. Gox repayment plan may cause some bitcoin selling among analysts, but this is expected to be brief and followed by more price increases later this year and in early 2025.

Ledn's chief investment officer, John Glover, stated that Mt. Gox users' windfall is likely to result in significant bitcoin sales as investors aim to secure their profits.

Glover, a former managing director at Barclays, stated that many people will profit from the Mt. Gox bankruptcy and consider it the best investment they've ever made. He added that some individuals will opt to take their money and leave.

Last month, JPMorgan analysts predicted that Mt. Gox customers would sell some of their bitcoin to capitalize on the cryptocurrency's price increase.

If most of the liquidations by Mt. Gox creditors occur in July, this could lead to a decline in crypto prices in July, followed by a rebound from August onwards.

The total sum owed to creditors, which is approximately 140,000 bitcoins, represents about 0.7% of the current 19.7 million bitcoin in circulation.

Even though it may affect prices, there is sufficient liquidity to soften the impact of any severe selloff, according to analysts.

According to James Butterfill, head of research at CoinShares, the billions of dollars' worth of bitcoin being traded on trusted exchanges daily this year indicates that "liquidity is sufficient to absorb these sales over the summer months."

Jacob Joseph, a research analyst at CCData, stated that the markets are capable of handling the selling pressure.

He informed CNBC via email that a significant portion of the creditors are likely to accept a 10% reduction in their holdings in order to receive early repayment, and not all holdings will be sold on the open market, thereby decreasing the overall selling pressure.