News
Bitcoin Crashes to $55,000 as Mt. Gox Exchange Begins Repaying Creditors
Top line
The price of Bitcoin fell to its lowest level since February on Friday morning, amid a broader sell-off in the cryptocurrency market, as the defunct cryptocurrency exchange Mt. Gox, which collapsed in 2014, began the process of repaying its creditors.
The price of Bitcoin briefly dropped below $54,000 on Friday.
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Main aspects
The price of the world’s most valuable cryptocurrency briefly fell below $54,000 in morning trading on Friday, before settling just above the $55,000 mark.
In the last 24 hours, the price of Bitcoin has dropped by more than 6.7%, and compared to last week, its value has fallen by more than 11%.
Other cryptocurrencies were also hit by the sell-off, with Ether falling below $2,900, down more than 9%, while other tokens such as BNB and Binance’s Solana fell 11% and 5.8%, respectively.
In addition to Bitcoin, Mt. Gox will also use Bitcoin Cash to repay its creditors, whose value has plummeted nearly 25% in the past week.
Key context
On Friday, administrators of the defunct Mt. Gox, which went bankrupt in 2014, said they had begun the process of repaying their creditors in accordance with their “Rehabilitation Plan.” Repayments will be staggered, with creditors receiving approximately 140,000 Bitcoin (worth $7.6 billion) and 143,000 Bitcoin Cash (BCH) tokens ($42.5 million) in total. On Thursday evening, Mt. Gox moved approximately 47,228 Bitcoin ($2.71 billion) from cold storage to a new wallet. The size of the payment has sparked concerns that creditors may liquidate some of the returned assets, thus depressing prices. Before it went bust, Mt. Gox was the world’s largest cryptocurrency exchange and in 2013 accounted for 70% of all Bitcoin transactions worldwide.
Big number
23.56%. That’s how much the price of bitcoin has fallen over the past 30 days. The plunge came after the token hit an all-time high of over $73,700 in March, largely driven by regulatory approval and the launch of spot bitcoin exchange-traded funds.
Further reading
Bitcoin Price Drops Below $58,000 For First Time In 2 Months (Forbes)