The rehabilitation program of Mt Gox exchange is all set to be implemented in October 2020.
With the huge influx of Bitcoin in the market, the fear of selling pressure would rise to lead to a bear market.
Creditors to Get back their bitcoin holdings
In a massive update for the Mt Gox exchange victims who lost their bitcoin holdings in a hack in 2013, the rehabilitation plan is scheduled to take place on 15 October 2020.
On this day, nearly 150,000 BTC could be possibly distributed among the creditors of which holders share a large share. This could indicate a possible bear market for bitcoin in the coming days.
However, the deadline has been moved numerous times, it would be interesting to view if the creditors will receive their holding on the scheduled date. And if they receive, the possible effect on the market should also be analysed.
Will Rehabilitation Plan Execute?
Mt Gox exchange was the largest place for bitcoin in 2013 where nearly 70 percent of the bitcoin trade occurred.
With an unfortunate attack, the exchange announced on 25 February 2020 that it had lost almost 840,000 BTC worth of $350 million at that time.
After dozens of lawsuits, a rehabilitation plan was set up to compensate the victims which after numerous delays is scheduled on 15 October 2020. For an instance, if the holders receive their Bitcoins, then the market impact would huge.
The current narrow trend is a matter of concern for many of the investors. Moreover, for almost 60 plus days bitcoin has maintained above $10000 but failed to cross $11000.
In these circumstances, if there is a large influx of nearly 150,000 bitcoins, the possibilities of selling pressure increases.
More than 75,000 BTC can be sold at once
As the victims have passed years with stress and poured in money to fight lawsuits. And when they are on the verge to receive their BTC, most of the people are expected to sell-off.
Another reason to sell could be the price, BTC was hardly $400 when they were stolen and now the price is above $10000, hence the ROI may be more than 2000 percent.
Therefore if we consider even half of the BTC being sold, then the market needs to sustain a selling pressure of 75,000 BTC at once. However, the people can also hold the digital asset anticipating a bull run in the future.
Collectively, Bitcoin maintaining a stagnant behaviour was an indication of the possible bull run which could occur after a breakout following a massive development.
But in the due course, if the selling pressure builds up, the price is expected to fall drastically till the market sustains and dilutes the pressure. Overall, good days might be seen for the investors who wish to stack up more coins but considering a major bull run, the bears need to move on first.