Germany has begun selling from its $3 billion Bitcoin stockpile, putting further downward pressure on the price.
Bitcoin is already struggling around $65,000, and the ongoing $700 million ETF outflows this week and Germany's selling aren't helping matters.
Analysts like Ali see Bitcoin dropping to $54k if the bears have their way.
The German government obtained all this Bitcoin after seizing nearly 50,000 BTC from a piracy website in 2013.
Bitcoin is currently not in the most bullish position at the moment, and there are several reasons for this.
Alongside the miners selling, the massive number of short positions stacked against the cryptocurrency (according to Coinglass), and the ongoing outflows from the spot Bitcoin ETFs, we have a new wave of selling pressure on Bitcoin—which might all be coming from Germany.
According to insights from Arkham Intelligence, the German government has been selling millions of Bitcoin for a while now and may have an even bigger stockpile of around $3 billion worth of the cryptocurrency to sell.
Here's everything you need to know about Germany's Bitcoin stockpile and what selling it might do to the market.
Arkham, a leading blockchain analytics firm, took to Twitter this week to report that the German government has sold over $195 million worth of Bitcoin so far.
Arkham says that on Thursday, the German government sent around $65 million worth of Bitcoin to two addresses, including one confirmed to be a Coinbase address.
The crypto intelligence firm also noted that on 19 June, the German government similarly moved $130 million to four exchange addresses, including two confirmed to be Kraken and Bitstamp.
So far, crypto exchanges like Coinbase, Kraken, and Bitstamp have received substantial Bitcoin transfers. Within two days, crypto exchanges received nearly $200 million worth of Bitcoin worldwide, indicating that the German government may be gearing up for even bigger sell-offs.
But where does this leave the Bitcoin Market?
The Bitcoin market is already feeling the impact of this sell-off, considering that Bitcoin appears to be struggling around $65,000.
The chart from Santiment below also shows a waning amount of volatility on Bitcoin over the last week or so, compared to the extra-long bars on the cryptocurrency around March, when we saw the $73,800 all-time high.
Waning volatility on Bitcoin
Ali, a renowned analyst on Twitter, has also lent an opinion on the Bitcoin issue, noting that the cryptocurrency has dropped below a major pricing band of around $67,890.
Bitcoin’s MVRV pricing bands
“Bitcoin has dropped below the +0.5σ MVRV pricing band at $67,890,” the analyst says.
Before dropping a warning that this drop below $67,890 might “trigger a correction toward the mean pricing band at $54,930.”
In essence, if the bears have their way, we might see Bitcoin test sub-$60k levels very soon.
The source of this Bitcoin mountain in the German government’s wallets is as interesting as their current selling spree.
The German government recently seized nearly 50,000 BTC from the operators of Movie2k.to, a movie and software piracy website in 2013.
Despite the ongoing sell-offs, the German government still has more than $3 billion worth of Bitcoin, and the crypto community is quietly bracing for impact if or when the Germans decide to sell another heavier load.
Overall, as the miners and the German government continue to sell, the spot Bitcoin ETFs have seen their fifth consecutive day of outflows as of 20 June, according to data from Soso Value.
Spot Bitcoin ETF outflows
So far this week, between 13 and 20 June, the Bitcoin ETFs have bled around $700 million worth of Bitcoin, all of which continues to contribute to the bearish pressure on Bitcoin.
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