Analysts at digital asset management firm CoinShares believe that the fear surrounding the repayments of defunct cryptocurrency exchange Mt. Gox is exaggerated. Mt. Gox was once the largest Bitcoin exchange but went bankrupt and lost most of its coins due to theft. However, the exchange has since recovered most of its coins and has been in a lengthy bankruptcy process to repay its former customers. This has created uncertainty in the market, as the potential sell pressure from the exchange could impact the price of Bitcoin if it were to sell its BTC to redeem creditors.

CoinShares, in a new report, suggests that many of the Mt. Gox creditors are likely to hold on to most of their coins in order to minimize their tax burden. When selling does occur, the firm expects it to be spread out across multiple crypto exchanges, allowing buy-side liquidity to absorb the sell pressure.

The report highlights that creditors are up roughly 13,600% due to Bitcoin’s significant price increase since the time of the Mt. Gox incident. As a result, selling immediately would result in a substantial tax event for many creditors. Therefore, it is highly likely that most creditors will either sell only a small portion of their holdings or hold onto their coins for the time being.

CoinShares also points out that creditors have received numerous offers from claims buyers over the past 12 years, which would have resulted in a USD payout. However, if a USD payout was appealing, many creditors would have already taken it. Therefore, it is difficult to estimate how many coins will be sold in the market following the distribution.

The distributions will take place on various exchanges, including Bitstamp, Kraken, Bitbank, BitGo, SBI VC Trade, and others, spread out over different dates throughout the month. This distribution strategy reduces the likelihood of large concurrent selling.

CoinShares concludes that the potential sell pressure is more of a concern than the actual selling itself. At the time of writing, Bitcoin is trading at $60,146.

Please note that the opinions expressed in this article are not investment advice, and investors should conduct their own research before making any high-risk investments in Bitcoin or other cryptocurrencies.