German Bitcoin Emptied Pressure Remains in Menteugou

Bitcoin news website reported:
Mt. Gox, once the world’s largest Bitcoin exchange, was hacked in 2014 and 850,000 Bitcoins were stolen. After a decade of bankruptcy proceedings, compensation is finally underway. It is expected that by October of this year, Mt. Gox will pay 142,000 BTC (Bitcoin) and 143,000 BCH (Bitcoin Cash) to creditors.


Regarding the exact repayment time, Mt. Gox announced on July 5th that it has started repaying creditors through various cryptocurrency exchanges as planned. However, the specific timing of receiving the repayment will vary depending on the exchange that the creditors use. For example, Kraken’s repayment time is 90 days, while Bitstamp’s is 60 days.
Arbitrage opportunities arise?
Although the market is concerned that this may exacerbate the selling pressure on Bitcoin, Singapore-based quantitative trading company Presto Labs believes that Mt. Gox’s repayment will bring arbitrage opportunities. The company advises clients to go long on Bitcoin and short BCH to profit from Mt. Gox’s repayment process.
In a report released on Wednesday, Peter Chung, a market analyst at Presto, pointed out:
Mt. Gox’s trustees plan to distribute billions of dollars worth of BTC and BCH between July 1st and October 31st, 2024, which could change the supply-demand dynamics of BTC and BCH during these four months and create opportunities for pair trading.


Pair trading is a trading strategy that involves simultaneously buying and selling two financial assets, taking long or short positions, with the aim of profiting from their relative price movements.
Peter Chung pointed out that Presto Labs’ analysis shows that the selling pressure on BCH will be four times that of BTC, meaning that BCH’s daily trading value of 24% is equivalent to BTC’s daily trading value of 6%. Excluding funding rate risks, going long on BTC perpetual contracts and pairing with shorting BCH perpetual contracts is the most effective market-neutral strategy.
Creditor behavior predictions
CoinGecko data shows that in the past 24 hours, BTC’s trading volume has exceeded $26.5 billion, while BCH’s trading volume is only over $250 million. Presto Labs also believes that early Bitcoin adopters may be “strong Bitcoin holders,” so Mt. Gox creditors who receive compensation are more likely to continue holding a portion of their Bitcoin rather than selling it directly. However, for BCH, as its investor base is weaker, Mt. Gox creditors who receive BCH compensation may sell all of it in the short term.
Analytical perspective
The Bitcoin selling pressure caused by Mt. Gox will be smaller than expected.
Since nearly 75% of the creditors chose the early payout (accepting a 10% discount), there are currently only about 95,000 Bitcoins available for early payment compensation (the remaining Bitcoins will take longer to pay).


Certain creditors will hold onto Bitcoin more than the market expects. They are long-term holders and tech-savvy individuals, and many have even rejected attractive offers from the claims fund for years.
Furthermore, with the price increase, even if only 15% of the physical claims are recovered, claim holders have already appreciated their recovered Bitcoins 140 times since the bankruptcy (in USD terms).
Therefore, the selling pressure on Bitcoin will not be as great as investors imagine, but BCH may face more severe declines due to its lower liquidity.