I’m Not Responsible for Bitcoin Price Crash says Mt. Gox Trustee

These days, Mt. Gox is referred to as the defunct cryptocurrency exchange that went bankrupt in 2014 as a result of one of the most devastating crypto exchange hacks in the history of the crypto market. Nevertheless, the saga of the once largest cryptocurrency exchange platform in the world is anything but over. Every now and again, a story relating to Mt. Gox captures most of the headlines in the cryptocurrency community.

A few weeks ago, the story broke out that Nobuaki Kobayashi, the Mt. Gox bankruptcy trustee had so far sold $400 million worth of Bitcoin and Bitcoin cash as part of the efforts to pay back the exchange platform’s creditors. Unsurprisingly, this led to a great deal of speculation that Kobayashi’s actions had a detrimental effect on the cryptocurrency market in light of the massive price decline that has rocked the market since the start of 2018.

The cryptocurrency market is notorious for being a highly volatile market with massive price swings that can be caused by a number of factors. Impending government regulations and largescale dumping of coins are among two of the most common causes of price dips. Even on online forums like Reddit, the debate concerning whether Kobayashi’s actions affected the price of cryptocurrencies continues to rage on.

Setting the Records Straight

In the midst of the public debate, Kobayashi himself has decided to clarify a number of issues. In a statement released on Saturday, March 17, 2018, the Mt. Gox trustee refuted the claim that his sale of Bitcoin and Bitcoin cash materially affected the price of those two crypto species in the market. The report is a transcript of the Question & Answer session that took place at the 10th meeting of the Mt. Gox creditors on Wednesday, March 7, 2018.

In the statement, Kobayashi tried to set the record straight with regard to the March 7 report that had provided an accounting of the sales process. Many proponents of the notion that the large sale of Bitcoin and Bitcoin cash have affected the market point to March 7 report for justification. To them, the large selloff of those two cryptos contributed to the market decline that has seen more than 50 percent wiped off from the total market capitalization.

Commenting on the issue, Kobayashi maintained that the sale of Bitcoin and Bitcoin Cash was carried in such a manner as not to have any detrimental effect on the market while at the same time, ensuring that the security of the transactions wasn’t compromised. He went on further to say that the assumption that the days in which coins were transferred to a wallet address were the same days those coins were sold is incorrect. He maintained that the coins were sold at an appropriately high enough price based on the prevailing market value of both coins at the time.

However, despite Kobayashi’s claims, a correlation shows that there was a negative effect of the coin sales at least in terms of the short run daily figures. The Mt. Gox estate still has about $1.9 billion worth of cryptos yet unsold but Kobayashi is still awaiting a court ruling to determine the next course of action.

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