The German government’s recent efforts to empty its bitcoin wallets of billions of dollars in assets seized from criminals have come to a close, with the wallets now holding zero digital assets, according to new data from blockchain analytics firm Arkham Intelligence.
The month-long process of transferring funds from the government’s bitcoin wallets sparked fear in the crypto community that the price of bitcoin would plummet. However, contrary to expectations, bitcoin’s price actually rose by 3%. As of now, bitcoin is valued at over $58,000, representing a 1% increase in the last 24 hours.
In June, the German government’s bitcoin wallets held nearly $3.4 billion in bitcoin, but Berlin has been actively working to liquidate its seized assets. Earlier this month, the Federal Criminal Police Office of Germany offloaded $2.8 billion in bitcoin, or 50,000 bitcoin, to major crypto exchanges in the U.S. and Europe like Coinbase, Bitstamp, and Kraken.
Market watchers closely monitored the government’s sell-off and noted that some of the transferred funds were returned to the German government’s wallet addresses, indicating a strategic approach to gauging liquidity before offloading assets.
Despite initial concerns, the completion of the sell-offs alleviated fears in the crypto market. In fact, some analysts suggest that heightened levels of investor anxiety could present prime opportunities to buy bitcoin.
“One of the best metrics for identifying optimal entry points in a bull market is when short-term bitcoin holders sell at a loss and the fear index is ridiculously high,” noted a CryptoQuant analyst. “In contrast, previous market peaks have been signaled by long-term holders taking significant profits over numerous months, which hasn’t happened yet.”
Overall, the German government’s successful liquidation of seized bitcoin assets has not only demonstrated its commitment to combating criminal activity but has also provided valuable insights into market dynamics for crypto investors.