Mt.Gox Repays Bitstamp Customers As Hong Kong Launches Inverse Bitcoin ETF
Mt. Gox is set to release another batch of Bitcoin into the market as it continues its creditor repayment program. The company announced this move today while explaining that they have executed their first test repayment transaction to every Bitstamp cold wallet owner.
Arkham Intelligence: the blockchain intelligence company, which was announced on the company’s official X handle on July 22 had initially flagged this test transaction. Data shows that Bitcoin is valued at over $9.4 billion, and owned by 127,000 Mt. Gox customers who have waited more than ten years to regain their funds.
Some industry experts have expressed concern over the potential impact the selling pressure may cause. Zoltan Vardai from Cointelegraph wrote that the Mt. Gox repayment program is expected to cause a downward price of Bitcoin, which currently sells for $66,904.
To prove their unfazed investment strategy, some Bitcoin whales, on July 17, went ahead to buy more 245 BTC, valued at $16 million, amid the proposed decline in the price of Bitcoin. Some of the addresses linked to this major purchase have only transacted Bitcoin twice in 2024, making more than $30 million in net profit.
Mt. Gox Creditors Differ on the Next Step After Getting Paid
Vardai also asserted that some of these creditors may be looking forward to selling their assets immediately after they receive them, considering that it has increased by more than 8,500% over the last 10 years. On his X handle, Jacob King, a popular finance analyst, validated Vardai’s claim, confirming that 99% of Mt. Gox customers are ready to sell their assets upon receiving it.
King added that billions of Bitcoin will be circulating and look more like a dump in the coming weeks. He said he isn’t expecting a bullish trend soon after the news breaks out. However, a poll on Reddit suggested that 56% of Mt. Gox creditors are expected to continue holding onto their Bitcoin assets after the repayment.
20% of the respondents had said otherwise, expressing their intentions to sell. More than 30% of Bitcoin assets owned by Mt. Gox creditors, as of July 17, have been transferred to creditors, while Bitcoin whales have continued to acquire more Bitcoin unabatedly.
HKEX Gets Ready to Launch the First Inverse ETF Tomorrow
In other news, the Hong Kong Stock Exchange (HKEX) is set to launch its first inverse Bitcoin Exchange Traded Funds (ETF) tomorrow. The proposed newly launched ETF, dubbed Company Share Option Plan (CSOP) Bitcoin Futures Daily (-1x).
Inverse Product is developed to allow traders to gain from the dropping price of Bitcoin without cutting down on the assets. Data from Arkham Intelligence says that the wallet linked to Mt. Gox is currently holding 90,300 units of BTC, valued at $6.12 billion. It is still uncertain when Mt. Gox will continue with the repayment process.
According to the product description, the ETF will be targeted at short positions as regards trading Bitcoin futures contracts on the Chicago Mercantile Exchange (CME). This will allow the value of the ETF to go up whenever the price of Bitcoin drops.
Traders Advised to Leverage New ETF Against Bitcoin Price Drop
Traders are recommended to use the introduction of the new ETF to hedge against the dropping price of Bitcoin, considering the amount of Bitcoin Mt. Gox is planning on releasing into the market in the coming weeks. The Product goes against the direct shorting of Bitcoin assets by offering traders another option to bet against Bitcoin.
The Hong Kong and Shanghai Banking Corporation (HSBC) is the ETF’s trustee. The fund is said to be charging a 1.99% service fee annually and is currently targeted to attract around $50 million to100 million in assets in the space of two years. However, Inverse Bitcoin ETFs’ popularity has drastically increased moments after the news of the launch broke out.
ProShares Short Bitcoin ETF (BITI), a United States-based ETF, has reported having more than $70 million in Assets Under Management (AUM). Meanwhile, the CSOP Bitcoin Futures will be the first in the Asian continent and is set to introduce more funds into Hong Kong’s stock market, which is currently worth $5.4 trillion.
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