Mt. Gox, the shuttered cryptocurrency exchange based in Tokyo, still possesses approximately 34,689 Bitcoin (BTC) as it approaches the repayment deadline on October 31.
The exchange lost around 650,000 BTC due to undetected thefts from 2011 until it collapsed in 2014, while about 200,000 BTC was later discovered in an old wallet format. These coins formed the basis for repayments to creditors, managed by court-appointed trustee Nobuaki Kobayashi.
In 2017 and 2018, Kobayashi earned the moniker “Tokyo Whale” for selling Mt. Gox Bitcoin to fund fiat repayments. In mid-2024, there was a notable increase in wallet activity with around 100,000 BTC being transferred between Mt. Gox addresses for distribution, although not all transfers indicated direct sales.
The repayment deadline was pushed back by a year to allow creditors more time to complete their claims. With nearly $3.9 billion in Bitcoin still residing in Mt. Gox-related wallets, this Halloween could raise concerns about potential sell pressure.
Here’s how the movement of Mt. Gox’s Bitcoin has influenced market dynamics throughout its bankruptcy and civil rehabilitation.
Tokyo Whale’s initial Mt. Gox Bitcoin sales
Kobayashi’s first significant round of Bitcoin sales occurred between September 2017 and March 2018, with blockchain data showing the largest offloading on February 6. By mid-March, Mt. Gox’s Bitcoin reserves had decreased to about 166,000, after Kobayashi revealed the sale of 35,841 BTC for 38 billion Japanese yen (approximately $360 million at the time).
This may not seem like a major supply disruption in today’s Bitcoin market. On Wednesday, Bitcoin had a market capitalization of $2.24 trillion, while earlier in February 2018, it was around $140 billion, making Kobayashi’s sales amount to about 0.26% of the asset’s total value.
Related: $19B crypto market crash: Was it leverage, China tariffs, or both?
Kobayashi’s February 6 sale coincided with Bitcoin’s decline to approximately $6,000, marking the lowest point of the first quarter that year. Bitcoin was already on a downward trend from its peak of nearly $20,000 in December 2017 during the initial coin offering (ICO) boom.
While Bitcoin was already experiencing difficulties post-ICO bubble collapse, its significant drop on February 6 closely aligned with Kobayashi’s major sell-off. Kobayashi contested that his Mt. Gox liquidations exacerbated the drop, though his actions faced criticism from market watchers.
Tokyo Whale ceases selling at approximately 144,000 BTC
Following the early 2018 ICO crash, Bitcoin and the broader cryptocurrency sector plunged into what is now termed the first crypto winter, marked by waning liquidity and a slowdown in funding, leading many crypto firms to downsize or close.
Kobayashi continued to exacerbate the situation by selling off more of Mt. Gox’s Bitcoin. Approximately 24,658 BTC was sold between April 27 and May 11, reducing the exchange’s reserves to 141,686. The first notable sale on April 27 was for about 15,000 BTC. Bitcoin experienced a sharp decline on April 25-26 but rebounded on April 27 before initiating a minor rally to Q2 2018’s peak of nearly $10,000. Kobayashi’s second major sale on May 11 coincided with another downturn.
This marked Kobayashi’s last sale of Mt. Gox’s Bitcoin. In June, following a creditor petition, the Tokyo District Court halted bankruptcy proceedings and initiated civil rehabilitation while appointing Kobayashi as rehabilitation trustee. In bankruptcy, non-monetary claims convert to cash, while in civil rehabilitation, Bitcoin claims are not liquidated, with repayment structured by a court-approved plan allowing distributions in BTC or Bitcoin Cash (BCH) instead of cash.
Related: Democrats counter US crypto framework; bill grinds to a halt
With Mt. Gox sales suspended, Bitcoin maintained levels above $6,000 for much of the year until November’s Bitcoin Cash hard fork unsettled the market. Mt. Gox’s holdings stayed stable at around 142,000 BTC during this time.
Initiation of Mt. Gox Bitcoin repayments
By mid-2024, Bitcoin was in a much stronger position compared to the Tokyo Whale period, riding high from the positive trends following the introduction of the first US spot Bitcoin exchange-traded funds. It was mid-way through a bull rally that would ultimately push Bitcoin past $100,000 by December 2024.
In early July, Mt. Gox wallets began transferring Bitcoin as the exchange geared up for creditor repayments under the civil rehabilitation plan. Markets initially worried that recipients would instantly sell their holdings. Bitcoin dipped again after Kraken, one of the exchanges managing distributions, announced on July 24 that it had finalized its process.
Some analysts speculated that as many as 99% of creditors might sell their shares upon receipt. However, when repayments actually commenced, there was “no significant spike” in trading volume, according to Ki Young Ju, founder of CryptoQuant.
By August 1, Arkham data indicated that Mt. Gox’s holdings had decreased by almost 100,000 BTC, leaving around 46,000 BTC still under the trustee’s control.
Approaching Mt. Gox’s extended Bitcoin repayment deadline
On October 10, 2024, Kobayashi announced that most repayments to verified creditors had been finalized, yet many remained pending due to incomplete procedures or processing issues.
With court endorsement, the repayment deadline was shifted from October 31, 2024, to October 31, 2025, and the trustee urged the remaining creditors to complete their submissions via the Mt. Gox claims portal.
As of this writing, Mt. Gox wallets still hold about 34,689 BTC valued at approximately $3.9 billion, awaiting distribution.
In March 2025, the exchange began moving assets between its wallets, presumably a preparatory step for additional repayments leading up to the Halloween deadline.
Magazine: Review: The Devil Takes Bitcoin, a wild history of Mt. Gox and Silk Road
