According to Zombit’s previous report, the online addresses marked as Mt.Gox transferred a large amount of Bitcoin at the end of May, which was later confirmed by the official in a public letter as preparation for creditor repayment on October 31. Mt.Gox will distribute 142,000 Bitcoins (BTC) to creditors, with a total value exceeding 9 billion USD. If creditors choose to sell their Bitcoins, it will be a significant test for the market’s ability to absorb large orders.
However, the cryptocurrency market research firm Kaiko Research shared some good news in its latest report. The report indicates that the market depth of BTC and BCH has increased by about 30%, reaching levels similar to those before the FTX collapse. If a selloff were to occur in the short term, the current market depth may help mitigate potential price fluctuations.
Kaiko emphasized, however, that there is a significant difference in available liquidity between the Bitcoin and Bitcoin Cash markets. The liquidity of Bitcoin Cash is noticeably lower than that of Bitcoin, with a daily average depth of only 9 million USD, representing just 3.5% of Bitcoin’s depth. Currently, BCH’s buy-side depth is only 4.8 million USD, meaning that equivalent sell orders could lead to a 1% drop in BCH price. BCH’s market depth is far lower than it was in September 2021 when prices were similar. In other words, if creditors sell their assets, Mt. Gox’s repayment could have a significant impact on BCH.