Germany, once one of the world’s largest holders of bitcoins, appears to be gradually divesting its reserves. According to blockchain data, the German government’s wallet now contains just 9,000 bitcoins, down from almost 50,000 BTC at the start of the year.
This substantial drop in Germany’s bitcoin holdings raises questions about the potential impact of these sales on the market for the flagship cryptocurrency.
The liquidation of bitcoins seized by Germany
The German government began liquidating its bitcoin reserves in early 2024. These bitcoins had been seized from operators of the Movie2k.to website in 2013.
Since then, Germany has gradually sold off a large proportion of these bitcoins, reducing its portfolio from almost 50,000 BTC to just 9,000 BTC today. This massive sale has undoubtedly exerted downward pressure on the bitcoin price in recent months.
The potential impact on the bitcoin market
The liquidation of bitcoins held by Germany raises concerns about its impact on the cryptocurrency market. With almost $9 billion worth of bitcoins still to be sold, selling pressure could continue to weigh on prices.
Some analysts believe that these sales have already contributed to the recent fall in the price of bitcoin, which has lost almost 20% of its value in one month. The end of this sales program could, however, bring some relief to the futures market.
The geopolitical stakes of bitcoin holdings
Beyond its impact on the market, Germany’s bitcoin liquidation also raises geopolitical questions. Some observers consider it a “strategic error” for a state to dispose of its bitcoin holdings in favor of fiat currencies.
As bitcoin is more difficult to acquire than traditional currency, some believe that Germany should hold on to its bitcoin reserves rather than sell them. This could give it a geopolitical advantage in the long term.
