TL;DR
- The German government has sold Bitcoin worth around $2 billion, obtained from the Movie2k.to case.
- Initially, they chose to sell on centralized exchanges (CEX), causing volatility in the market.
- They have recently transferred BTC to large traders for potential OTC transactions, signaling a possible strategic shift.
Since mid- June 2024, the German government’s massive sale of Bitcoin (BTC), originally confiscated from the piracy site Movie2k.to, has had a significant impact on the cryptocurrency market.
Initially, the government’s decisions to sell directly on CEX generated notable turbulence, affecting the price of Bitcoin worldwide.
The initial strategy included the sale of approximately $2 billion worth of Bitcoin, split between direct transactions on CEXs and transfers to wallets associated with large market operators such as B2C2, Flow Traders and Cumberland, for possible OTC trading purposes.
This latest move, which represents a strategic shift towards less disruptive sales, appears to have been implemented after recognising the negative impact of direct sales on the market.
The impact on the cryptocurrency market was immediate: Bitcoin experienced a significant drop, falling below the critical support level of $54,000.
However, the price has shown recovery, currently standing at around $57,683.
These fluctuations underline the market’s sensitivity to institutional selling and media coverage of such events.
According to on-chain analytics platform Spot On Chain, these government sales, while relatively small compared to Bitcoin’s daily trading volume (~$36 billion), have had a substantial impact on market sentiment and volatility.
The firm also predicts a continuation of volatility in the near term, with Bitcoin fluctuating between $56,000 and $70,000 until July 2024, and a considerable probability (48%) of prices falling below $60,000.
Bitcoin Future Perspective’s
Looking ahead, Spot On Chain projects a bullish outlook for Bitcoin.
With a 63% probability of BTC hitting $100,000 by the end of 2024 and a sustained uptrend into the first half of 2025, monetary policies and institutional demand are anticipated to remain key drivers for the growth of the digital asset.
Expectations of a lower interest rate environment and the perception of Bitcoin as a higher risk asset continue to support these projections.
While the German government’s Bitcoin sell-off has created short-term volatility, the long-term view for Bitcoin remains positive, reflecting its consolidation as a valued asset class and its continued potential to reach new valuation heights.
