Justin Sun has expressed the intention to purchase a stock of Bitcoin worth 2.3 billion dollars held by the German government, with the aim of minimizing the negative impact on the crypto market.
The portfolio associated with the German government has indeed consistently sold its Bitcoin reserves, creating a selling pressure that threatens the stability of the market.
The proposal by Sun could represent a solution to avoid further fluctuations and maintain the trust of investors in the Bitcoin market. Let’s see all the details below.
Summary
Justin Sun’s offer: a strategic move to mitigate selling pressure on the Bitcoin market
As anticipated, the founder of Tron, Justin Sun, has proposed to purchase the Bitcoin reserves held by the German government, worth more than 2.3 billion dollars.
This move is aimed at reducing the negative impact that the sale of such holdings could have on the cryptocurrency market.
The well-known entrepreneur in the field of criptovalute has stated that he is willing to buy Bitcoin (BTC) off-market to minimize the effect of the sale on the price.
Sun has communicated its offer through a post on July 4th stating the following:
“I am ready to negotiate with the German government to purchase all the BTC off-market, in order to minimize the impact on the market.”
Suspicions regarding the sale of Bitcoin by the German government emerged on June 19. That is when a wallet associated with the government made a transfer of 6,500 BTC, worth over 425 million dollars.
The possible sale of the remaining shares has raised concerns among traders, for the potential negative impact on the price of Bitcoin.
Before this transfer, the wallet held nearly 50,000 BTC since February 2024, funds that are believed to have been seized from the operator of the pirate movie website Movie2k.
The German government and the sales of Bitcoin
The cryptocurrency portfolio, labeled by the platform Arkham Intelligence as “Governo tedesco (BKA)”, refers to the Federal Criminal Police Office (BKA) of Germany.
In January, the BKA confiscated 50,000 BTC in Dresden from the operator of Movie2k, considered the origin of these funds.
It is not yet clear which authority is conducting the sale of the BTC. However, a spokesperson for the BKA confirmed that the criminal unit does not hold the seized Bitcoin. Kristina Sawazki, spokesperson for the BKA, explained:
“In principle, the sale or conversion of the Bitcoin seized into euros is the responsibility of the public prosecutor’s office or the competent court. The proceeds from the seized assets are paid to the revenue office of the place where the competent court is located, pursuant to Article 60 of the Code of Criminal Procedure. The BKA only retains the crypto-assets seized or confiscated during investigations for the public prosecutors.”
Since June 19, the portfolio associated with the German government has continued to sell Bitcoin. The latest transfer, which took place on July 4, saw the movement of 172 million dollars in Bitcoin to various cryptocurrency wallets.
Some of these were directed to three popular centralized exchanges (CEX): Coinbase, Kraken, and Bitstamp. In total, 75 million dollars in Bitcoin were transferred to these exchanges, suggesting an intention to sell.
A few days earlier, on July 2, the German government’s portfolio transferred 52 million dollars in BTC, with 100 BTC sent to Coinbase, 150 BTC to Bitstamp, and 32.74 BTC to Kraken.
Bitcoin reaches new lows and recovers: price analysis and forecasts
Bitcoin has recently experienced a sharp drop reaching a low of $58,555, only to recover quickly. On June 25, Bitcoin showed signs of consolidation above the psychological threshold of $60,000, suggesting the end of the bear phase.
The cryptocurrency has surpassed the current support and reached a peak of $63,911. However, the positive momentum was halted by the 21-day simple moving average (SMA), which acts as resistance at $64,000.
After being rejected by the moving average line, Bitcoin has returned to the support level of $60,000. If the sellers manage to break the current support of $60,000, Bitcoin could fall further, reaching a low of $58,555.
An additional bear momentum could bring the price down to $56,711. On the contrary, if the support of $60,000 holds, Bitcoin will continue to move within a range below the moving averages.
The simple moving average over 21 days is currently acting as a resistance line for the price. On July 1st, a long candlestick surpassed this resistance line, but the long shadow of the candlestick indicates strong selling pressure at this level.
