The German government has recently sold a significant portion of its Bitcoin holdings, reducing its original 50,000 BTC to just 5,800 BTC, according to recent reports and blockchain data.
Recent Transfers and Market Activity
On July 12, the German government resumed its Bitcoin sales, moving 3,200 BTC across various platforms. According to Arkham blockchain data, transfers were made to Bitstamp, Kraken, and Coinbase, each receiving 400 BTC. Additionally, 1,000 BTC and 500 BTC were sent to two unknown addresses.
Crypto analyst Michaël van de Poppe speculated in a post on X that the remaining Bitcoin, worth approximately $300 million, would likely be sold on July 12. Historically, such large-scale sales by government entities can lead to market volatility. However, the distribution across different platforms may help mitigate extreme price fluctuations.
Saxony, a German State, has sold almost all seized Bitcoin. They held $3.5B of Bitcoin (50000 $BTC) and are only left with approximately $300 million, likely to be sold today.
It’s incredible that this sell pressure has been absorbed and that Bitcoin’s price is around $60K. pic.twitter.com/AFBhYZq3wE
— Michaël van de Poppe (@CryptoMichNL) July 12, 2024
Background and Sales Details
The German government’s Bitcoin wallet initially held 50,000 BTC, which were seized from a film pirating website in January. Since June 19, the wallet has transferred billions of dollars worth of Bitcoin, with intensified activity starting in early July. As of now, the wallet has sold 44,200 BTC, accounting for 88.4% of its original holdings.
On July 11, the wallet briefly fell below 5,000 BTC after transferring approximately $615 million worth of Bitcoin to various cryptocurrency exchanges, including Coinbase, Bitstamp, Kraken, Flow Traders, and two unknown addresses.
Reactions and Market Implications
German lawmaker and Bitcoin advocate Joana Cotar expressed her disapproval of the large-scale sale of Bitcoin. Cotar suggested that the cryptocurrency could have been used as a strategic reserve currency to hedge against risks in the traditional financial system.
The recent decline in Bitcoin’s price has been influenced by several factors, including the German government’s significant BTC sale and concerns over Mt. Gox potentially releasing over $8 billion worth of Bitcoin to its creditors. These developments have contributed to market uncertainty and downward pressure on prices.
The careful and methodical approach in distributing Bitcoin across various platforms might help prevent severe market disruptions, but the overall sentiment remains cautious as the market absorbs these substantial sell-offs.
