The German government has resumed the sale of its confiscated Bitcoin assets amidst a recent downturn in the cryptocurrency’s value.
Germany, Europe’s largest economy, has started selling portions of its substantial Bitcoin holdings valued at approximately $3 billion.
These assets were seized from Movie2k.to, a movie piracy website, in 2020.
In January, German authorities seized 50,000 BTC from the piracy site, marking it as the “largest Bitcoin confiscation by law enforcement in the history of the Federal Republic of Germany,” according to a press release.
Last week, the country sold about $325 million worth of Bitcoin, with the potential for further sales.
Recently, the German government transferred 200 BTC to Coinbase, while the same wallet also sent 200 BTC to Kraken.
El Salvador Keeps Accumulating
Since adopting Bitcoin as legal tender in September 2021, El Salvador has steadily increased its holdings of the cryptocurrency.
Currently, the country possesses approximately 5,748 BTC, valued at around $360 million based on the latest data.
El Salvador has acquired its Bitcoin reserves through direct purchases, mining operations, and investments facilitated by foreign entrepreneurs drawn to the nation’s favorable crypto policies.
The government of El Salvador has maintained a proactive approach to bolstering its Bitcoin treasury, implementing a policy of acquiring 1 BTC daily. This strategy underscores their commitment to holding (“HODLing”) Bitcoin assets for the long term, despite market fluctuations.
President Nayib Bukele has been firm in his stance against selling the country’s Bitcoin reserves, even as their value has significantly appreciated. Recently, Bukele highlighted that El Salvador’s Bitcoin investments have surged by more than 40%.
Bitcoin Dips Below $60,000
The German government’s decision to sell off its Bitcoin holdings coincided with a temporary decline in Bitcoin’s price, briefly dipping below the $60,000 mark.
Another significant event affecting the market is the upcoming distribution of Bitcoin owed to former customers of the now-defunct cryptocurrency exchange Mt. Gox.
Mt. Gox, which declared bankruptcy over a decade ago due to multiple hacking incidents, plans to initiate the distribution of assets to its customers starting in July.
The exact amount of Bitcoin slated for distribution remains uncertain, with estimates ranging widely from 65,000 to 140,000 BTC. This distribution could potentially inject up to $9 billion worth of Bitcoin into the market.
Concerns have been raised about the potential selling pressure resulting from the influx of BTC, but some argue that its impact might be exaggerated.
Creditors have had ample time over the years to sell their claims if immediate funds were needed, potentially mitigating any adverse effects on prices.
Meanwhile, the broader category of digital asset investment products experienced a second consecutive week of outflows, totaling $584 million.
Investor sentiment has been affected by pessimism surrounding potential interest rate cuts by the Federal Reserve, which is seen as a contributing factor.
Last week also marked a significant downturn in trading volumes for Exchange-Traded Products (ETPs) globally, reaching their lowest levels since the launch of U.S. ETFs in January, with just $6.9 billion traded throughout the entire week.
