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The German government has been selling off significant portions of its bitcoin holdings, causing ripples in the crypto market. These sales follow the seizure of nearly 50,000 bitcoins from a movie piracy website earlier this year.
What's the scoop?
- On Monday, the German government transferred over 16,000 bitcoin to various exchanges and market makers, including Coinbase, Bitstamp, Kraken, and Flow Traders, totaling more than $900 million in overall value.
- The extensive sales have pressured the bitcoin price, which fell as low as $55,000 before recovering slightly to $56,000 on the day.
- The selloffs have faced criticism from some German officials, including Bundestag member Joana Cotar, who has argued that the government should consider holding bitcoin as a strategic reserve currency rather than dumping the seized crypto.
Bankless take:
The selling will continue until morale improves, or rather until the German government runs out of bitcoin. According to crypto data platform Arkham, the government’s holdings still stand at over 23.78K BTC, or +$1.3 billion, and at this point it seems unlikely that the selling will be paused. That said, the German government's aggressive liquidations has undoubtedly impacted market sentiment, with the episode demonstrating the influence that large institutional movements can have on crypto prices.
