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Latest news after Germany’s sales and the collapse of Bitcoin’s price: attention to other countries’ BTC reserves

The latest crypto news speaks unilaterally about the recent sales of Bitcoin (BTC) held by the government of Germany.

In January, the country announced the seizure of 50,000 BTC after some investigations related to the piracy site β€œmovie2k.io”, for illegal activities such as copyright infringement and money laundering.

Today, that amount totals approximately 37,000 BTC, with 13,000 units already sold by Germany since early June onwards.

If events of this kind scare you as they could trigger a sell-off in the price of Bitcoin, you haven’t seen anything yet.

Other countries hold much larger sums in Bitcoin, capable of seriously putting a spoke in the wheels of the bull market of cryptocurrencies.

Let’s see everything in detail below.

Latest market news: Germany sells another 1,400 Bitcoin and brings the total stock below 40,000 BTC

The latest news from the crypto market is all centered around the Germany issue, with the German government selling large amounts of Bitcoin seized in January.

According to the data reported by the Arkham Intelligence platform, the Germans have already liquidated 13,000 BTC of the 50,000 BTC in their possession, for a value of 742 million dollars.

At the time of writing the article, there are now 37,000 BTC remaining in cold wallets, equivalent to 2.1 billion dollars.

The selling phase was advanced by Germany starting from June 19, 2024, after the approval of the financial regulatory authorities.

Since that day the price of Bitcoin has been down by 12.5%, highlighting a sort of correlation between the price action of the coin and events of this type.

Source: https://platform.arkhamintelligence.com/explorer/entity/germany

More specifically, we can see how several coins from the portfolio of the Federal Republic of Germany have been liquidated just in these hours.

As also reported by Arkham, we notice several transfers during the night to crypto exchanges such as Coinbase, Kraken, Bitstamp, and Flow Traders.

Today around lunchtime, other interactions were made, some of which related to the simple transfer to other private addresses.

We also do not know if the portfolio manager might have also dealt with another dealer over-the-counter (OTC) or market maker.

It is therefore not certain that all 13,000 BTC that left the cold wallet of Germany have all been sold on the market for FIAT. The coins transferred to the exchanges have presumably already been sold, while others simply sent perhaps have not yet been.

It is clear that a good portion of these funds is intended to increase the liquidity of the β€œBundesregierung”, threatening the price action of Bitcoin.

Source: https://platform.arkhamintelligence.com/explorer/entity/germany

How much have Germany’s sales actually impacted Bitcoin’s price action

Much of the crypto community believes that the impact of Germany’s sales has caused a drop in Bitcoin prices in recent weeks.

In reality, however, observing the data of the spot and futures volumes recorded in recent days, it seems that the only thing that had a significant impact was THE NEWS of the alleged sales.

The narrative of the potential decline that would have been triggered by the liquidations from Germany has been the real driver of the negative price action of the crypto.

In fact, the market is always in search of narratives to justify the current price trajectories, even without a connection justified by the numbers.

Observing the BTC spot volume chart from The Block, we see that the average (7D) of the last month has fluctuated between 4.3 and 7 billion dollars per day.

In total since June 19, the days when Germany started the sales session, until today spot volumes on Bitcoin for 109 billion dollars have been moved

Even assuming that all 13,000 BTC that came out of the cold wallet of Germany were sold for a total of 742 million dollars, this implies the responsibility for just 0.68% of that amount.

Source: https://www.theblock.co/data/crypto-markets/spot/btc-and-eth-total-exchange-volume-7dma

Examining, instead, the data from Coinglass on the future volumes recorded by BTC since June 19, we can only reinforce the above thesis.

In fact, the volume in Bitcoin derivatives markets has been stable around the threshold of 30 billion dollars daily. The implication of the sales directly from Germany represents a marginal share compared to what is really moved by the market

These data show how sometimes it is simply the news that creates the conditions for the evolution of an asset’s prices.

In reality, we do not know who caused the drop in Bitcoin prices, whether an institution, the retail or a large investor.

Without delving into conspiracy theories, we simply say that surely someone has sold, the cause of the declines cannot be directly attributed to the actions of Germany

Source: https://www.coinglass.com/currencies/BTC

Watch out for BTC reserves of other countries: USA, CHINA, UK, and UKRAINE threatening the price of the crypto par excellence 

If sales from Germany did not explicitly affect the collapse of Bitcoin prices, those from other countries could instead have a decisive impact.

The German government is not in fact the largest holder of cryptocurrencies, and it does not even rank in the top 3 of this ranking.

According to the chart from BitcoinTreasuries.net, governments around the world collectively hold 557,773 BTC, totaling 32 billion dollars.

Some by confiscation, some by acquisition, the countries with the most BTC held in cold wallets are as follows: in first place we find the United States with 213,246 BTC, equivalent to 12.16 billion dollars

In second place is Cina with 190,000 BTC, equivalent to 10.8 billion dollars, while closing the podium is the Regno Unito with 61,000 BTC, for 3.48 billion dollars.

Above Germany, we also find Ukraine with 46,351 BTC equal to 2.64 billion dollars.

Source: https://bitcointreasuries.net/, chart not updated to date. The BTC held by Germany are actually 37,000

If all these governments started selling off their Bitcoin at the same pace as Germany is doing, then we could witness a negative impact on the price of the currency

Already in the previous days, we witnessed suspicious movements by the United States government, which transferred 237 BTC to another address.

The loot of the States comes from the seizure of funds from the Bitfinex hacker and from the online drug site Silk Road

It is not certain that the US government, as well as the Chinese government, will decide to sell the Bitcoin in their possession for dollars.

However, their presence on centralized crypto entities raises an alarm about possible future price crashes.

Furthermore, if the news of sales from Germany triggered a 12.5% sell-off in a few days on BTC, what will the narrative of a similar event for USA and CHINA entail?

In these situations, it is crucial to remain clear-headed and follow your previously established investment strategies.

If you do not have an investment strategy and let yourself be carried away by market news, you are probably approaching it wrong from the start.

Alessandro Adami
Alessandro Adami
Graduated in "Information, Media and Advertising", for over 4 years interested in the cryptocurrency and blockchain space. Co-Founder of Tokenparty, community active in spreading crypto-enthusiasm. Co-founder of Legal Hackers Civitanova marche. Information technology consultant. Ethereum Fan Boy and supporter of Chainlink oracles, strongly believes that smart contracts will be central in the development of society.