The German government’s Bitcoin sell-off is about to end, with minimal impact on the cryptocurrency. Recently, they transferred an additional 3,250 BTC, worth around $190 million, to exchanges, leaving approximately 190 million worth of Bitcoin at stash.
The German government initially held nearly 50,000 BTC, seized from the operators of the film piracy platform Movie2k.to, which ceased operations over a decade ago. Since mid-June, authorities have been selling these coins on major exchanges like Coinbase, Kraken, and Bitstamp, as well as over-the-counter trading desks.
The latest sale last month brings the total offloaded to over 40,000 Bitcoin, valued at around $2.35 billion. On-chain data indicates Germany now holds just 9,925 Bitcoin, worth $560 million.
This prolonged liquidation has put pressure on Bitcoin’s price, which fell below $53,000 earlier this month when repayments from the defunct cryptocurrency exchange Mt. Gox began to creditors.
With the government’s Bitcoin reserves dwindling, analysts predict potential relief for the cryptocurrency market. The remaining $560 million is a small portion of daily Bitcoin trading volumes and much less than Germany’s initial stash.
Experts forecast that Germany could soon exhaust its entire Bitcoin holdings if the current selling pace continues. The decision to sell has faced criticism from Bitcoin proponents within the German parliament, who argue that the government should retain the scarce digital asset instead of converting it to euros.
A report from Bitfinex suggests that “a potential local bottom has been reached.” It notes that while the German government is selling large amounts of BTC, these funds are relatively small compared to the total BTC traded since last year.
Additionally, volatility metrics are showing signs of stabilisation. The narrowing gap between implied and historical volatility suggests that the market expects a period of greater stability, implying that Bitcoin’s price may remain around current levels or experience less dramatic declines.
