The repayment of Mt. Gox creditors has ranked among the notable events impacting the crypto sector in recent weeks, given its potential to influence market sentiments in a bearish manner.
In the latest development, reports indicate that the Kraken crypto exchange has sent out emails to community members confirming that the trading platform has successfully received creditor funds.
The exchange reportedly received Bitcoin (BTC) and Bitcoin Cash (BCH) from the Mt. Gox trustee. The funds must be deposited into users’ accounts within two weeks.
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Confirming the Mt. Gox repayments is pivotal, prompting much speculation about its impact on Bitcoin’s price. In this context, Finbold consulted OpenAI’s latest artificial intelligence (AI) tool, ChatGPT-4o, to determine how Bitcoin’s price will likely react in the short term amid the repayments.
Fundamentals around Mt.Gox repayments
Indeed, the AI tool acknowledged that the fear of a massive sell-off by Mt. Gox creditors has already caused some price volatility. It noted that Bitcoin dropped below $60,000 following the news, reflecting concerns about an influx of Bitcoin into the market.
The AI tool noted that estimates suggest not all the released Bitcoin will be sold immediately. Many Mt. Gox creditors might be long-term holders and may choose to retain their Bitcoin rather than sell it at once. Therefore, with only a fraction of the Mt. Gox BTC expected to hit the market immediately, the selling pressure might be less severe than initially feared. This could lead to short-term volatility but may not cause a significant long-term drop in price.
At the same time, ChatGPT-4o noted that the cryptocurrency market has matured since 2014, and it’s now more capable of absorbing large inflows without as much volatility as in the past. Additionally, it suggested that technical analysis points to strong support around the 200-day moving average, which could help stabilize prices.
Given these factors, the AI platform suggested that while there might be some short-term volatility and potential dips in price due to the Mt. Gox repayments, the overall impact might not be as severe as some fear.
Bitcoin price prediction
By August 1, ChatGPT noted that Bitcoin could potentially stabilize and trade around or slightly below the current level, barring any additional market shocks or significant sell-offs by creditors.
Therefore, the AI tool predicted that a speculative price range for Bitcoin could be between $58,000 and $65,000 due to the factors surrounding the Mt. Gox payment. For August 1, the AI tool predicted that the leading cryptocurrency might trade in the range of $61,000 to $63,000.
In this context, if the prediction comes to pass, Bitcoin will likely still be trading in a range considered crucial to the next all-time high. Indeed, part of the market consensus maintains that Bitcoin needs to trade above $60,000 to validate any bullish sentiments.
In the meantime, Bitcoin has reclaimed the $64,000 mark, with eyes on $65,000. By press time, BTC was valued at $64,013, with daily gains of over 2%.
Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
