Impact of Germany’s Million-Dollar Bitcoin Sell-Off on Prices
Germany’s recent sale of a significant portion of their seized BTC holdings has caused a price decline, impacting holders’ profitability and the number of long-term holders. Bitcoin slipped below the $65,000 mark, leading to a negative sentiment surrounding the digital asset.
The spotlight is on Germany’s crypto holdings following a massive fire sale. Over two days, the German government sold nearly 1,700 Bitcoins, valued at $110 million, on major exchanges like Kraken, Coinbase, and Bitstamp. Despite this move, it only represents a small fraction of their massive $43 billion Bitcoin reserves.
The on-chain activity indicates a strategic decision to offload a portion of their Bitcoin holdings. Germany has been accumulating Bitcoin through seizures, with a total of 50,000 confiscated in recent years. Despite the recent sale of 3,000 BTC, Germany still holds substantial unrealized profits.
The surge in Bitcoin’s price has significantly increased the value of Germany’s holdings, estimated at $3.24 billion, with unrealized profits of $1.1 billion. This positions Germany as the world’s fourth-largest Bitcoin holder, trailing behind the US, China, and the UK.
The US holds a larger amount of 213,246 Bitcoins valued at $13.7 billion, while China, despite past sell-offs and a ban on transactions, still retains 190,000 Bitcoins. The recent German sell-off, combined with outflows from spot Bitcoin ETFs, is contributing to the current selling pressure on Bitcoin.
At present, BTC is trading at $64,562.51, with a 1.29% decline in the last 24 hours. The MVRV ratio for BTC has also dropped, indicating that most holders are not profitable currently, potentially affecting sentiment negatively.
The decrease in long-term addresses holding BTC suggests a decline in the number of long-term holders. This trend, coupled with low profitability, implies that holders may need to wait longer to sell and make a profit. The recent German sell-off and other factors may continue to impact Bitcoin’s performance in the near future.
