Markets
Cryptocurrency Market Concerns Ease as Germany Ends Bitcoin Selloff
The German government’s efforts to empty its Bitcoin wallets of billions of dollars in assets seized from criminals reached their conclusion on Friday afternoon, with the wallets now containing no digital assets, according to new reports. data from blockchain analytics firm Arkham Intelligence.
Over the past month, wallet transfers have sparked intense fear within the crypto community that the price of bitcoin, the world’s largest cryptocurrency, could plummet due to massive sales by the German government.
Instead, the price of bitcoin has increased 3%At the time of writing, the price of bitcoin is now valued at over $58,000, which represents a 1% jump in the last 24 hours.
In June, German government Bitcoin wallets contained nearly $3.4 billion in bitcoin, but Berlin has been working hard to liquidate the seized assets. Earlier this month, Germany’s Federal Criminal Police Office, known as the Bundeskriminalamt (BKA), offloaded $2.8 billion in bitcoin, or 50,000 bitcoins.
The government transferred funds to major cryptocurrency exchanges in the United States and Europe such as Coinbase, Bitstamp and Kraken.
Market observers of the German government selloff have been closely following Bitcoin wallet transfers and have noted that some of the government transfers have been sent back to German government wallet addresses, indicating that the BKA was simply assessing liquidity before offloading assets.
On Thursday, the cryptocurrency Fear and Greed Index plunged into “extreme fear” due to the German government transfers, but that nervousness was quickly calmed when the sales were completed. In fact, some analysts point to the fact that high levels of investor anxiety may present prime opportunities to buy bitcoin.
“One of the best metrics to identify optimal entry points in a bull market is when short-term bitcoin holders are selling at a loss and the fear index is ridiculously high (which has happened in recent weeks),” note a CryptoQuant analyst. “In contrast, previous market peaks have been signaled by long-term holders realizing significant profits over several months, which has not happened yet.”