The specter of Mt. Gox looms over Bitcoin: JPMorgan predicts a stormy summer

Creditors of the former Mt. Gox exchange platform are preparing to receive their repayments in Bitcoin as early as July. According to JPMorgan, these distributions could lead to significant sales in the market, putting short-term pressure on the price of BTC and other cryptos.

A massive influx of Bitcoin into the market

Mt. Gox plans to repay about 142,000 bitcoins to its creditors between July and October, worth an estimated $9 billion. JPMorgan analysts expect the majority of these distributions to occur in July. This sudden arrival of a large volume of Bitcoin on the market has raised concerns among observers.

Indeed, JPMorgan experts estimate that many creditors may be tempted to quickly sell their newly recovered assets. Some holders have been waiting for this repayment for nearly 10 years and see the price of Bitcoin much higher than at the time of the Mt. Gox bankruptcy in 2014. This dynamic could create strong selling pressure in the short term.

JPMorgan analysts predict that these potential sales in July could weigh on the entire crypto market. However, they envisage a possible rebound as early as August, once the initial wave of liquidations has passed.

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A context of multiple reimbursements in the crypto ecosystem

The Mt. Gox case is part of a broader pattern of payouts within the crypto sector. Recently, Gemini Earn creditors received $2.18 billion worth of digital assets. JPMorgan believes that some of those assets have likely already been sold, contributing to the recent price decline.

Furthermore, FTX creditors are expected to receive their cash repayments after October 7, for an amount estimated between $14 billion and $16 billion. Unlike Mt. Gox's in-kind distributions, these cash payments could have a positive effect on the market. JPMorgan analysts anticipate that many pro-crypto lenders will reinvest these funds in digital assets.

The next few months therefore promise to be eventful for the crypto market. Between potential sales linked to Mt. Gox in July and reinvestments from FTX creditors at the end of the year, prices could experience strong volatility.

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