Germany Depletes Bitcoin Reserves, Selling Off Confiscated Assets
The German state of Saxony is quickly diminishing its Bitcoin reserves by selling off confiscated assets to various crypto exchanges. Earlier this year, the government seized Bitcoin from Movie2K, a film piracy website, and began auctioning off around $3 billion worth of BTC.
Germany’s Sell-Off of 35,000 BTC This Week
Bitcoin wallets linked to German authorities transferred 10,567 BTC (approximately $600 million) to entities such as Bitstamp, Coinbase, Kraken, Flow Traders, and Cumberland DRW on Thursday. These transactions occurred in multiple batches throughout the day, resulting in the wallets holding only 6,894 BTC ($394 million), down from nearly 50,000 BTC three weeks ago.
- Germany could finish the sell-off by Friday or early next week, having unloaded 35,000 BTC this week alone.
- The total count may fluctuate as wallets sometimes receive portions of the transferred assets back from exchanges and brokers during the day.
Crypto Investors Express Concerns About Oversupply
The sell-off has raised concerns among crypto investors, with fears of an oversupply impacting the market. German lawmaker and Bitcoin activist Joana Cotar criticized the government for not adopting the asset as a strategic reserve currency to mitigate risks in the traditional financial system.
- The U.S. government, holding over $12 billion in seized Bitcoin, moved $240 million worth of BTC related to Silk Road to Coinbase.
- The defunct Japanese exchange Mt. Gox transferred its Bitcoin to creditors, sparking worries among investors about BTC’s decline during these sell-offs.
Fears of Sell Pressure Exaggerated, Says NYDIG
NYDIG’s Greg Cipolaro believes fears about excessive sell pressure may have been exaggerated. He noted that BTC’s decline surpassed the expected price impact from potential selling materializing.
- Bitcoin is trading at $57,281, down 6% over the last week and 15% over the last month.
- The recent bearish events have pushed the Crypto Fear & Greed Index into the “Extreme Fear” zone for the first time since January last year.
Hot Take: Reflecting on Germany’s Bitcoin Sell-Off
Germany’s rapid depletion of Bitcoin reserves through the sell-off of confiscated assets continues to draw attention and concern from crypto investors. While fears of an oversupply impacting the market persist, NYDIG’s Greg Cipolaro suggests that these concerns may be exaggerated. The sell-off has led to a decline in Bitcoin prices, reflecting broader unease among investors in the crypto space.
Sources:
– Arkham Intelligence
– NYDIG
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