Mt. Gox: “Bitcoin market crash not our fault”

The crypto exchange Mt. Gox denies that it is partly to blame for the fall in the exchange rate of the crypto currencies. Mt. Gox had sold in the past winter Bitcoin and Bitcoin Cash in the value of over 400 million US Dollar.

Parallel to this, the Bitcoin loophole share price fell in several phases

The insolvency administrator of Mt. Gox, Nobuaki Kobayashi, has issued a statement in which he comments on the allegations regarding the Bitcoin loophole sale. In the Q&A document, he states that he sold Bitcoin (BTC) and Bitcoin Cash (BCC/BCH) from December 2017 to February 2018. When asked how he chose the timing, Kobayashi replies:

“Since the market price of BTC and BCC [BCH] is subject to significant fluctuations, it is difficult to predict whether the Bitcoin loophole market price will rise or fall at any given time. I have determined the exact timing after consulting the court.”

Exact the news spy transaction periods not known

He does not reveal how, where or when the news spy transactions took place. The reason for this is that potential future sales could otherwise be jeopardized. When asked whether the sale influenced the market price, Kobayashi answers:

“I did not sell BTC and BCC [BCH] through the Exchange in the normal way, but in a way that avoided influencing the market price and at the same time ensured the security of the transaction as much as possible. The court has approved the selling method. Therefore, I do not believe that our sale of BTC and BCC [BCH] affected market prices. Please note that the transfers of addresses that I manage do not necessarily mean that I sold the Bitcoin at those times. Please refrain from analyzing the correlations […] between our sales and market prices based on the assumption that the sales occurred at the time that BTC and BCC [BCH] were shipped from the addresses I manage. Such an assumption is wrong”.

So the public movements on the Mt. Gox accounts are not supposed to have been the actual transactions. Since they do not disclose the method, many now assume that they are trading on a dark pool.

Analyses do not give a clear result
An analysis by Cointelegraph showed that sales (if they had taken place at the time in question) were not very decisive for the overall trend, at least in the short term. The daily closing of the Bitcoin price was negative only once after the five sales. It was possible that the sales caused the share price to slide for a short time, but investors immediately let it rise again. Nevertheless, the quantities that Kobayashi is currently selling are likely to cause panic in the market. Other analyses concluded that Mt. Gox was very likely partly to blame for the price drop.

Mt. Gox was one of the leading Bitcoin Exchanges until she fell victim to a hack in 2014. Approximately 850,000 Bitcoin were stolen. The company was then forced to file for bankruptcy. After it became known two weeks ago that Mt. Gox had sold 35,841 Bitcoin and 34,008 Bitcoin Cash to become liquid for its creditors, there was criticism. The sales took place during the same period in which the Bitcoin and other crypto currencies had lost heavily in value. Many accused the stock market of having sold at a bad time and at too low a price and of being partly responsible for the downward trend.