Bitcoin fell sharply in early Asian trade on Monday, reversing a modest rebound seen over the weekend and hitting an over four-month low on concerns over a flood of token supply from defunct crypto exchange Mt Gox.
The world’s biggest cryptocurrency fell 5.8% in the past 24 hours to $54,601.7 by 21:28 ET (01:28 GMT), coming close to its weakest level since late-February. The token also broke below a key $55,000 support.
Bitcoin was nursing steep losses in the past two weeks amid concerns over token distributions by Mt Gox. The trustees of the exchange said last week that they had begun distributing tokens stolen during a 2014 hack back to creditors through a slew of exchanges, although they did not specify just how many tokens were being returned.
Wallets associated with the exchange were seen mobilizing about $9 billion worth of Bitcoin earlier this year.
Mt Gox has been a major point of contention for crypto markets, as traders speculated that given the massive increase in Bitcoin’s price over the past decade, receivers of the token would be likely to sell it on the open market, increasing the token’s supply.
Fears of such a scenario spurred widespread dumping of the token, with several Bitcoin “whale” wallets also coming online and mobilizing their holdings for sales.
Selling in Bitcoin spilled over into the broader crypto market, with world no.2 token Ether sinking 7.3% to a two-month low.
