Mt. Gox’s upcoming Bitcoin distributions have been hanging over the cryptocurrency market since the order to begin repaying creditors was issued. Given the massive amount of BTC in Mt. Gox’s vault, the distribution is expected to put a ton of selling pressure on the asset. Now that the coins are starting to move, the cryptocurrency market is already reacting, even though the repayments have not yet begun.

Mt. Gox Transfers 47,229 BTC To Unknown Wallet

Early Tuesday morning, Mt. Gox Bitcoin wallet carried out notable transaction that caused a stir in the cryptocurrency community. The transaction, reported by on-chain data tracking and aggregation site Arkham Intelligence, was worth around 47,229 BTC.

Several initial transactions originated from a Bitcoin wallet labeled “Mt. Gox” to another wallet labeled “Mt. Gox: Cold Wallet.” A total of 47,229 BTC were sent to the frigid wallet. However, as soon as the coins arrived, they were transferred from the frigid wallet to another unidentified wallet.

The value of BTC coins at the time of the move was around $3 billion. To put that in perspective, that’s roughly the same amount of Bitcoin sold by the German government over the past few weeks, which caused the price of Bitcoin and the cryptocurrency market to plummet.

Given the volume of BTC, it is expected that if the coins hit the market, it would cause a similar decline as seen during the German government selling frenzy. In such a case, BTC price could once again return to the $50,000 level.

Interestingly, this transaction only represents about a third of the total amount that Mt. Gox is expected to return to creditors. The bankrupt exchange had previously transferred 47,000 BTC, which had little impact on the market. Creditors are expected to receive around 150,000 BTC, which is worth $9 billion. So if Mt. Gox’s entire BTC supply hit the market, it could trigger a massive crash.

Bitcoin price reacts to movement

Following the Mt. Gox Bitcoin move, the cryptocurrency asset reacted negatively, falling sharply. For example, the price of BTC fell from over $64,000 to under $63,000 in less than an hour, dragging the rest of the market with it.

There was also an augment in Bitcoin’s daily trading volume, increasing by 44% to over $38 billion. This suggests increased investor activity, and as the price is falling, it suggests that investors are selling, not buying, BTC at this point.

Featured image created with Dall.E, chart from Tradingview.com