Mt Gox is one of the prominent crypto exchanges years ago. Unfortunately, things got complicated for the business when it declared Bitcoin in its platform missing. After which, the company filed for bankruptcy, with thousands of cryptocurrency gone. People linked the lost assets to the company’s inadequate security measures, despite being one of the world’s biggest Bitcoin exchange platforms.
Cybersecurity is still a considerable concern for the crypto space because criminals explore different ways to make away with digital assets. Since six years ago, when investors lost their assets, they finally announced some settlements for their stolen securities. The exchange plans to settle with Bitcoin, which causes some displeasure in the space due to the new flow of assets that would circulate amidst BTC’s constant price corrections. It’s good to that price increase could cause problems for the company.
How Mt Gox went bankrupt
Exchanges several years ago were easy victims of different cyber attacks from criminals. Mt Gox declared bankruptcy when 850,000 BTC got missing, with almost all of that being owned by customers. The security breach cost the firm billions as it finally agrees to pay a significant amount from the missing digital assets.
With Bitcoin’s value rise, the firm will pay slightly over 100,000 BTC with about $5 billion. Since the announcement, the firm did not inform investors of the day they would receive their holdings, but sources suggest that it would come soon.
The crypto space is voicing some concerns with the new Bitcoin payments. Traders fear that the settlement would instigate investors to sell their holdings, leading to increased selling pressure. Experts fear that Bitcoin might crash if investors keep selling their holdings to cash out from the booming investment. Coinlab will also receive its share of Bitcoin from Mt Gox after legal battles. The former partners worked together, with CoinLab managing some payments for the exchange company.
Investors have a choice
CoinLab revealed that former investors of Mt Gox could decide to take the 90% fund settlement if they wanted or wait till legal battles against the exchange. The former established that it wasn’t involved in the settlement but will continue with its legal claims against Mt Gox. The investors faced a continuous legal battle against the company, which never reaches a satisfying conclusion, so this early settlement looks attractive to the holders. The Japanese firm has not spoken on the new agreement, which is worrisome.
Concerning the effect on Bitcoin pricing, that is another problem why investors worry. If the holders sell-off those enormous amounts of BTCs at this period, people are afraid that the cryptocurrency might not handle the heavy hit. Currently, Bitcoin is starting to gain some bullish momentum after the week started with continuous price changes.
Apart from Bitcoin, Ethereum is also gaining alongside major digital assets. If a price happens again, some people think it would affect all digital assets because of their correlation. Still, it is great news for Mt Gox investors to finally get their holdings back, especially when the currency gained immensely.