Bitcoin price fell below $65,000. In conjunction with major Bitcoin movements by the German Federal Criminal Police Office (BKA).
According to Arkham, BKA sent $425 million worth of Bitcoin to various wallets. Including trading platforms Kraken and Bitstamp, raising questions about the potential impact on the markets.
Bitcoin transfer by the German government
The German Federal Criminal Police Office (BKA) transferred a large amount of Bitcoin on June 19. From Arkham data. BKA transferred 6,500 BTC worth $425 million from its wallet.
Of this amount, $32 million worth of Bitcoin was sent to Kraken and $32 million to Bitstamp. These transactions indicate that there may be an intention to sell some property.
claimed Miguel Moore, CEO of Arkham. The entity disbursed $130 million in BTC to so-called service wallets. This is an indication of an imminent sale. The transfer was first spotted by @Defi_Maestro. Strategist Mantle on social media platform X, suggesting it could cause a stir in the market.
BTC seizure by BKA
BKA's bitcoin is derived from the confiscation of approximately 50,000 BTC from the owners of Movie2k.to. It is a movie streaming service that was operating in 2013. The BKA obtained the funds in mid-January 2024 after the suspects made a “voluntary contribution” to the organization.
Since February, the German government-branded wallet held this amount of Bitcoin until the last transfer.
According to Arkham, the wallet initiated several transactions on June 19, with one resulting in 6,500 BTC and another input of 2,500 BTC to the wallet address. This move excited cryptocurrency enthusiasts. Everyone began to wonder about the German government's motives for selling.
Bitcoin market reaction and price trend
Information regarding BKA's Bitcoin transactions affected market sentiment shortly after the announcement. Analysts noted an increase in the number of short positions and a slight decrease in the price of Bitcoin after conversions. Consequently, the price of Bitcoin fell below $65,000 as happened in the past during large transactions conducted by government agencies.
However, the real number of BTC transferred to Kraken and Bitstamp was around 500 BTC each. This is what some analysts believe should not lead to a major change in the market. However, the knowledge that the government is liquidating assets may cause market volatility in the short term.
At the same time, cryptocurrency analyst AliCharts noted that Bitcoin has fallen below the +0.5σ MVRV pricing range to $67,890. Which indicates a correction towards the middle price range of $54,930. By comparing the MVRV ratio with the one-year simple moving average. We see that the momentum is actually bearish, meaning that Bitcoin is trading at a loss compared to some previous takeover prices.
BTC Derivatives Data
The German government's recent activity also coincided with other market indicators sending mixed signals. Bitcoin dominance fell sharply by 0.93% to 54.31%. Which means that investors seem to be turning towards altcoins. The Bitcoin trading account also had a small net outflow. Which is considered bullish as traders prefer to hold bitcoins rather than sell them.
The Fear and Greed Cryptocurrency Index fell by 13.51% to 64. This is still within the “greed” zone, meaning that overall sentiment remains optimistic despite the recent decline. However, the amount of open interest in Bitcoin futures and options is on the rise. Which indicates more speculation from institutional investors.
On the other hand, funding rates are slightly positive, which means that traders are willing to keep long positions open even after prices decline. This general market behavior indicates that although BKA transactions led to a decline in the near term, the long-term market sentiment remains positive.
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