The price of Bitcoin (BTC) fell on Friday, largely due to a large sell-off by the German government on Thursday. Within two days, the German government sold $323 million worth of Bitcoin, which had been confiscated in 2020 from Movie2k.to, an illegal movie website.
Confiscated Bitcoins are sold
In January 2020, German police seized 50,000 BTC from the website Movie2k.to, which is currently worth around $3 billion. German authorities stated in an official press release that this is the largest Bitcoin seizure in Germany’s history. In the past 48 hours, the German government sold a whopping $325 million worth of Bitcoin, causing significant volatility in the Bitcoin price.
According to the blockchain analysis platform Arkham, the German government’s action reflects a pessimistic expectation for the Bitcoin price:
“After the price drop of BTC, the German government has sold significant amounts of BTC as it believes that the price of BTC will continue to fall for the foreseeable future.”
Robert Quartly-Janeiro, head of strategy at crypto exchange Bitrue, highlights another aspect of the story. He wonders what the German government plans to do with the proceeds from this significant Bitcoin sale.
Other factors
While the recent Bitcoin price decline is partly due to the German government’s sell-off, volatility is also influenced by broader negative sentiments in the financial markets. Major markets like the S&P 500 are also seeing a dip right now, adding downward pressure on Bitcoin.
The correction over the past 24 hours also led to significant liquidations of long positions, which further increased volatility. In total, positions worth approximately $150 million were liquidated, of which 73% were long positions. For the time being, Bitcoin has not managed to turn the tide.
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Source: https://newsbit.nl/duitse-bitcoin-verkoop-doet-de-bitcoin-koers-dalen/
