Bitcoin Braces for Impact as Mt. Gox and US Government Prepare to Sell

The defunct crypto exchange Mt. Gox is planning to move the remaining 80.5K Bitcoins at a time when Bitcoin struggles to surpass the $70,000 level. Over the past two weeks, it has transferred nearly 50K Bitcoins to creditors on Kraken and Bitstamp. While creditors faced some withdrawal issues on the exchange last week, these problems have largely been resolved.

What should you expect ahead?

Test Transfers Hint at Bigger Moves

According to data from Arkham Intelligence, a Mt. Gox address (12Rgp) transferred 0.02 BTC, worth $1350, to another address beginning with 1Adb. The same address also transferred 0.0001 BTC to an address starting with bc1q. These transactions suggest that Mt. Gox is conducting test transfers before moving the remaining 80,128 BTC it holds, valued at $5.35 billion.

Mt. Gox creditors appear to be holding onto their BTC with “diamond hands.” Despite recent volatility, Bitcoin’s price has managed to absorb much of the selling pressure. However, late Monday saw BTC come under pressure again after facing rejection at the $70,000 level.

Bold Predictions

After breaking above $70,000, popular market analysts like PlanB predicted that the Bitcoin price rally could extend to $150K by year-end. PlanB also forecasted that Bitcoin’s price would double within the next 3-5 months.

U.S. Government’s Bitcoin Moves

Adding to the market pressure is the U.S. government’s transfer of Bitcoin. Arkham Intelligence reports that the U.S. government moved 29,799.99 BTC, worth $2 billion, to an unknown P2WPKH wallet on Monday. Despite this transfer, the U.S. government wallet still holds 183,439 BTC, valued at over $12 billion.

This development follows former President Donald Trump’s strategy to retain 100% of all the Bitcoin the U.S. government currently holds or acquires in the future if he is re-elected. However, the latest BTC transfer by the U.S. government has fueled speculations of a major sell-off, as signaled by Peter Schiff in his latest tweet.

Mt. Gox’s $5.52 Billion Transfers

Mt. Gox has recently executed a series of Bitcoin transfers totaling about $5.52 billion. After conducting preliminary test transactions, the exchange moved Bitcoin worth $2.85 billion to an undisclosed wallet. Subsequently, it transferred another $2.47 billion from a cold storage wallet to an unknown address, while also internally shifting a portion of its Bitcoin holdings between cold wallets.

Technical Analysis

On the technical side, analysts predict that if the $65,800 level holds, BTC could rebound to $67,400 or $68,100. This week, the U.S. Federal Reserve meeting will take place, and Chairman Jerome Powell will address inflation and the central bank’s plans for rate cuts.

With Mt. Gox and the US government holding such significant Bitcoin reserves, is a market crash imminent? Join the conversation.