Price of Bitcoin Drops Due to “Mt.Gox Dump” Fears, While Dell's (Apparently) Eying Bitcoin

June was Bitcoin's second down month in 2024. 

The price drop was mainly a result of fears surrounding Mt.Gox credit payouts as well as the U.S. and German governments selling Bitcoin. 

However, we also have some exciting news surrounding Dell, which may potentially use Bitcoin as a treasury reserve asset. 

There’s a lot to talk about. So, let’s jump right in! 

Bitcoin Dropped to Two-Month Low in June 📉

Bitcoin finished June in the red, closing the month at around $61,500. Several events initiated the price correction. 

First and foremost, two governments sold Bitcoin. 

The German authorities were the first, sending 6,500 BTC to Kraken and Bitstamp in mid-June. 🇩🇪

They confiscated 50,000 BTC earlier this year from Movie2k.to, an illegal movie-streaming website that accepted Bitcoin as a means of payment. In late June, the German government sent an additional 1,300 BTC to the same exchanges and 200 BTC to Coinbase. 

Arkham Intelligence first noticed the transactions as they tracked the wallet addresses from the confiscation earlier this year, and they have been following closely ever since. The authorities still hold 43,359 BTC at the time of writing but will likely sell the remainder of the coins. 

The United States also decided to sell Bitcoin. 🇺🇸

The U.S. government confiscated coins from Banmeet Singh, a convicted drug trafficker. 

On June 26, U.S. authorities sent 3,950 BTC to a Coinbase Prime address, following their German colleagues in selling the hardest asset on earth for money they could easily print out of thin air. 

However, we saw that these sales didn’t move the needle much. If anything, it led to a brief price correction. Investors started accumulating again, thanking both governments for the cheap sats they were able to stack. 

However, the price dropped a leg lower as news about the upcoming payout schedule of Mt.Gox creditors made the rounds. 

This was arguably the biggest price driver, so let’s talk about that in more detail. 

Mt.Gox Creditor Dump Fears Are Overblown 😱

Mt.Gox has been a hot topic in the Bitcoin community since the exchange closed down in 2014. Many have feared a potentially significant price dump in the future if the victims were ever to be repaid. 

In case you didn’t know, at one point, the exchange was handling around 70% of total Bitcoin exchange trade volumes and was hacked a decade ago. In total, 850,000 BTC were reportedly stolen. 

Out of those, 200,000 BTC were eventually recovered, and 140,000 BTC (worth around $9 billion) are being used to repay Mt. Gox's creditors. 

A rehabilitation trustee to repay the victims was set up following the exchange’s collapse and for the past decade, creditors had to be very patient. 

Various payout schedules have been proposed but always postponed. Many investors feared that they would never get their coins back. 

Earlier this year, we saw a transaction of 141,686 BTC sent from one of the Mt.Gox trustee wallets, and in May, they promised to use these funds to begin the repayment. 

The trustees again asked creditors to be patient. However, now there is a deadline of October 31, Japan time. Until then, creditors will apparently get their assets back. 

This time around, the creditors' patience seems to be paying off. 

On June 24, Mt.Gox announced the start of a payout schedule. The trustee stated that they’re working closely with crypto exchanges and different jurisdictions to repay every single creditor. 

According to the announcement, the payments are to be sent in Bitcoin (BTC) and Bitcoin Cash (BCH), meaning creditors will get their coins back.

Many in the Bitcoin community and analysts in the financial media world fear that the payouts could lead to a massive price dump, as most of the Mt.Gox investors would likely sell their coins. 

I think this fear is overblown, especially if you are a long-term investor.  

Considering how long the Mt.Gox creditors HODLed their coins and the huge upside Bitcoin currently presents, I find it very unlikely that all or even a majority of them would sell. 

Granted, there will be creditors who want to take their profits, but even of these, they’re likely to sell a portion of their stack and still HODL some coins. 

But also, the Bitcoin that would be sold will likely be eaten up by the market, potentially by the ETF issuers (who have been among the biggest buyers since the start of the year). 

Finally, some creditors (who chose early payout options) have already reportedly been paid, and they received their payouts in fiat currency. So, some creditor payouts won’t affect the market at all. 

While Bitcoin’s price has now dropped below $55,000 per coin as active Bitcoin traders positioned themselves for Mt. Gox creditor selling, the overall market sentiment should be bullish enough to continue Bitcoin’s positive price momentum going into the second half of the year once all the weak hands are shaken out. 

Is Dell About to Stack Sats? 

Governments don’t seem to understand the importance of having Bitcoin on their balance sheet. However, there is one guy in America right now who looks like he understands that Bitcoin is the best treasury reserve asset. 

That man is Michael Dell, the founder of Dell Technologies Inc. 

He’s been very vocal this month about Bitcoin’s potential and posted various tweets, teasing that Dell might soon be stacking some sats as well. 

The company used to accept Bitcoin as a means of payment, which means it understands Bitcoin and maybe even has a Bitcoin treasury already. 🤷

Michael initially reposted this X-post by Michael Saylor and soon followed with a post in which he changed the Cookie Monster slightly to be eating Bitcoin cookies. 

A week later, he followed up by posting a poll asking what the most important thing currently is, and you can guess what the outright winner was. 

So far, all of that is highly speculative. 

Neither Michael Dell nor his company have made any official statement. 

However, there is news that the company sold 10 million shares of Dell stock worth $1.3 billion, and Michael Dell himself sold $1.6 billion worth. This means that there is $2.9 billion in cash lying around. 

You might ask, what’s the best asset to allocate this money to? 

Bitcoin might be the answer! 😊

After all, the sale of these stocks took place earlier this month, and considering that Dell himself started posting about Bitcoin two weeks later, it could be that he’s already in contact with brokers and custodians to accumulate Bitcoin. 

If you think the MicroStrategy and Michael Saylor pumps were big, brace yourself for the Dell pump! Michael Dell is worth 25x more than Michael Saylor, and the Dell company is worth four times more than MicroStrategy.  

Once a big player like Dell accumulates, this could trigger a new wave of S&P 500 companies taking a closer look at Bitcoin and using it as a treasury reserve asset.   

But hey, I am not one to spread rumors! 

Until Dell announces something, all of this is just speculation. 

Bitcoin is Resistance Money 🎙️

A few weeks back, I had the pleasure of interviewing Brad Rettler, a philosopher whose unique insight into Bitcoin's dimension always resulted in a fascinating conversation. 

 In our chat, we explored how Bitcoin can challenge traditional monetary systems while promoting individual freedoms. 

He also explained the "veil of ignorance" thought experiment, urging us to consider a world with and without alternative assets and why we should care about financial privacy. It’s a must-watch for anyone who wants to experience the philosophical aspects of Bitcoin!  

Many of his ideas are also what motivated us at Samara Asset Group to invest in the Bitcoin ecosystem 

For all my American readers, I hope you’ve had an awesome 4th of July! 🇺🇸

Your stacker in sats,

Patrick Lowry

Thank you for reading Proof of Words. This post is public, so feel free to share it.