Defunct cryptocurrency exchange, Mt. Gox has kickstarted payment to rehabilitation creditors as part of its redemption plans. After more than 10 years of its collapse, the exchange is now on the course to reimburse affected users.
According to a statement released on Friday, the exchange revealed that it will carry out the payment process using Bitcoin and Bitcoin Cash. As revealed, the funds will be sent to some selected cryptocurrency exchanges that will then complete the repayment process.
Also, in the statement, Mt. Gox established that the creditors must fulfill certain terms before they become eligible to receive the funds. Some of these terms include confirming the validity of their accounts and accepting the terms of the agreement from the third parties handling the disbursement.
Furthermore, the Rehabilitation Trustee and the selected cryptocurrency exchanges will also need to complete their discussion about the repayment process. The discussion is aimed at ensuring that the two parties are on the same page regarding the repayment process.
How The Reimbursement Process May Pile Pressure On The Price Of BTC
As it stands, Mt. Gox will pay thousands of affected users about $9 billion worth of digital assets. Reports indicated that the exchange will be repaying about 141,000 BTC to affected users.
However, the news of the reimbursement has put BTC under negative price pressure. This is due to the sensitivity of the cryptocurrency market to any related news.
Presently trading below the $58k price benchmark, BTC has endured a difficult run in recent times. According to Coinmarketcap, the price of BTC in the last 30 days has dipped by 21.27%.
There are growing concerns that the repayment process in addition to other pressing factors will further pile pressure on the price of BTC.
Side Note On Mt. Gox
Meanwhile, it is worth mentioning that in its prime, Mt. Gox which is an acronym for “Magic; The Gathering Online Exchange” was the largest spot bitcoin exchange in the world. The exchange once claimed to be handling about 80% of the global dollar trades for BTC.
However, in 2014, the exchange suffered numerous attacks which claimed between 650,000 to 950,000 BTC, worth about $59 billion according to the current market price. Mt. Gox crumbled as a result of the huge loss.
Ever since its meltdown, the exchange has endured numerous delays and legal tussles during its bankruptcy process.
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