The German government has moved another portion of its massive Bitcoin reserves to exchanges.
Germany’s Federal Criminal Police (BKA) moved around $75 million worth of Bitcoin in multiple transactions on July 4, according to blockchain data.
These bitcoins will be sold on exchanges including Coinbase, Kraken and Bitstamp.
Since mid-June, the German government has transferred approximately $315 million in Bitcoin to various platforms, selling more than $390 million in Bitcoin in less than a month.
In 2013, the BKA seized nearly 50,000 bitcoins linked to the former operators of the movie piracy website Movie2K.
At today's prices, the assets are worth an estimated $2.3 billion.
The steady inflow of Bitcoin into exchanges suggests that Germany may be planning to liquidate some of its Bitcoin reserves to fill a fiscal gap.
The situation has raised concerns about the impact on the bitcoin market price, which fell below $58,000 this week.
However, the amounts transferred so far represent only a small fraction of the German Federal Reserve’s massive Bitcoin reserves.
After this massive sale, Germany still holds around 40,000 Bitcoins, putting enormous pressure on the market.
Coincidentally, the US government does the same thing.
On June 26, the U.S. government sent 3,940 bitcoins to Coinbase’s institutional trading platform, Coinbase Prime, in a transaction flagged by blockchain analytics firm Arkham Intelligence.
The Bitcoin being sold was originally confiscated from convicted drug dealer Banmeet Singh in early 2024.
Singh was arrested in London in 2019 on distribution charges and extradited to the United States in 2023.
As part of the conviction, U.S. authorities confiscated more than 8,100 bitcoins from Singh, worth about $150 million at the time.
While the U.S. government’s recent sale of nearly 4,000 Bitcoins is a significant amount, it only represents a small portion of the government’s total Bitcoin holdings.
Data shows that the US government currently owns about 214,000 bitcoins, worth more than $13 billion, making it the world's largest national holder of Bitcoin.
The government's bulk of bitcoins came from seizures associated with the shuttered darknet marketplace Silk Road, while the 2016 Bitfinex hack also contributed to the hoard.
The sale of these bitcoins to Coinbase suggests that the government may be looking to sell some of its long-idle bitcoin reserves. Coupled with the German government's simultaneous sale of bitcoins, this has heightened concerns about the impact on bitcoin prices.
Although the amounts transferred so far are relatively small compared to the daily volume of Bitcoin transactions, the U.S. and German governments still hold a large number of Bitcoins they seized, and coupled with the rapid rise in Bitcoin prices, the value of these Bitcoins is now much higher than before.
Plus, the timing of the U.S.-German sale, which comes as repayments to creditors from Mt. Gox’s 2014 collapse are set to begin in July, could add to selling pressure on Bitcoin.
