In 2014, Mt.Gox, the largest cryptocurrency exchange at the time, went bankrupt after hackers stole 650,000 BTC. Access to a quarter of this volume was subsequently recovered. The bankruptcy commission now has 162,100 BTC worth $11.1 billion.

On 31 October 2024, the deadline to repay Mt.Gox's liabilities to customers expires. Although most of the funds have been irretrievably lost, customers are eagerly awaiting payouts as Bitcoin's price has risen by 136 times in the meantime. In other words, $100 just 'sitting around' in an account, even taking into account the losses, has turned into $3386 for users.

Payouts will be made in cryptocurrency. On the one hand, this will curb the negative pressure on the market since not all victims will proceed to immediately cash out. On the other hand, the significant unplanned enrichment creates a temptation for mass withdrawal. 

It's hard to predict exactly what users will do. The total return is the same as the amount seen in the five months that spot ETFs have been active in the US. The hype around those instruments drove Bitcoin's price up from $45,000 to $70,000.

At a minimum, the start of payouts will be accompanied by a sharp rise in volatility, leading to a significant increase in forced closures of margin positions. At the same time, open interest (i.e., the volume of open trades in both buy and sell directions) in the open-ended futures market is close to an all-time high, sitting at $33.5 billion.

However, the possibility of another change in the maturity date shouldn't be excluded. Last year, for example, a month before the final date, rehabilitation trustee Nobuaki Kobayashi moved the deadline forward a year with permission from the court. It's possible that payments may be delayed again for some reason.

StormGain Analytical Group 
(platform for trading, exchanging and storing cryptocurrency)

Register on StormGain Now