The cryptocurrency market has faced unprecedented pressure recently, especially the sell-offs from the state, which have attracted widespread attention. The US government plans to sell about 69,370 Bitcoins, estimated to be worth about $4 billion, and about 833,000 Ethereum (ETH) related to the Chinese PlusToken scam may also enter the market, worth about $1.3 billion. These sell-offs may have a significant impact on the market, and investors have shown obvious concerns about this.
US sells off Bitcoin
According to the latest data, the U.S. government currently holds 203,239 bitcoins, worth more than $12.63 billion. These bitcoins mainly come from assets seized by the government in a series of judicial actions, including famous cases such as "Silk Road". The legal dispute over Silk Road lasted for more than four years, and these assets remained untouched. However, a ruling made by the U.S. Supreme Court on October 7 gave the government full control over Bitcoin, allowing the government to decide how and when any potential sales will be carried out.
In short, the U.S. Supreme Court allowed the sale of 69,370 BTC seized from Silk Road, with a total value of nearly $4 billion, equivalent to nearly one-third of the government's cryptocurrency reserves. According to the U.S. government's disposal model, these confiscated bitcoins are usually sold through public auctions. This sell-off plan may bring huge short-term pressure to the Bitcoin market. Such a large-scale Bitcoin sell-off will undoubtedly impact market prices, trigger panic selling or price fluctuations, and may even prompt more institutional or individual investors to temporarily exit the market to avoid risks.
In response, Peter Schiff, a well-known economist and Bitcoin critic, said that the market is already digesting the news and any sell-off from the country will not be optimistic. This means that investors may choose to wait and see when faced with such a large sell-off, resulting in reduced liquidity and increased price volatility.
Schiff further pointed out that the US government's sale may be for the purpose of alleviating the country's fiscal pressure. At present, the US national debt burden is increasing day by day, and the debt level has exceeded the 35 trillion US dollar mark. Although the sale of Bitcoin cannot fundamentally solve the US debt problem, the symbolic meaning behind it is worth pondering. This also shows that the government's supervision and utilization of crypto assets are constantly intensifying, and the freedom of the market may be more challenged.
China sells off Ethereum
Meanwhile, the PlusToken scam in China has also attracted attention in the cryptocurrency market. In the past few weeks, there has been a large transfer of Ethereum from PlusToken-related addresses for the first time since 2021. Analysts predict that as the remaining Ethereum is transferred, this may be a prelude to an upcoming sell-off. The market is concerned about this potential selling pressure, especially when the current cryptocurrency market is already under pressure.
PlusToken is a Ponzi scheme that attracted 2.6 million participants. In 2019, Chinese police arrested the main organizer of the scam and confiscated a large amount of crypto assets, including more than 833,000 Ethereum. According to the latest news, some of the confiscated Ethereum has begun to flow into exchanges, causing market uneasiness.
It is reported that about 7,000 Ethereums have been transferred to exchanges, including BitGet, Binance and OKX, with a total value of nearly $1.3 billion. This increase in liquidity has made the market full of concerns about future sell-offs. As more Ethereum is transferred, investors begin to worry that prices will be further suppressed.
Currently, the Ethereum market is already in a relatively sensitive stage, especially after the Ethereum 2.0 upgrade, the market sentiment is relatively complicated. On the one hand, the future development prospects of ETH are generally optimistic; on the other hand, a large amount of selling pressure may cause sharp fluctuations in ETH prices in the short term, and investors' confidence may be shaken.
Cryptocurrency Market Impact
The impact of these two selling plans on the cryptocurrency market cannot be underestimated. First, the US government's Bitcoin selling may cause a price collapse and affect investor confidence. The price of Bitcoin has already suffered a decline recently, falling from its peak to more than $60,000. As the government's selling approaches, investors may feel uneasy and choose to sell their assets, further exacerbating the downward pressure on the market.
Secondly, the Ethereum sell-off by Chinaâs PlusToken could also have a significant impact on the market. Based on the current market conditions, the price of ETH has already fluctuated, and some analysts predict that if this portion of Ethereum is sold in large quantities, it could cause the price of ETH to fall further. The marketâs panic over future sell-offs could intensify, further pushing up volatility.
However, from another perspective, these events may not be entirely negative news. Long-term holders of Bitcoin and Ethereum may view these short-term fluctuations as a good opportunity to buy, especially in the eyes of investors who are optimistic about the long-term prospects of cryptocurrencies. This large-scale flow of funds may also bring new participants to the market, prompting prices to rise again after a brief correction.
Summarize
Although the market may experience sharp fluctuations in the short term due to these events, the potential of cryptocurrencies cannot be underestimated in the long run. Bitcoin, as a digital gold, has gradually been recognized by more institutional investors, while Ethereum has become one of the hot assets in the market with its smart contract function and the rapid development of decentralized finance (DeFi) ecology.
In the future, as the government gradually advances cryptocurrency regulation and the market continues to mature, investors need to be more cautious in dealing with short-term fluctuations while seizing long-term growth opportunities. Whether it is the US government's Bitcoin sell-off or China's PlusToken's Ethereum transfer, they are important events in the development of the crypto market, and these events also reflect the complexity of the market and its huge potential in the future.
In summary, facing the turbulence and uncertainty of the cryptocurrency market, investors need to keep a clear head, pay attention to global market dynamics, and make reasonable investment decisions. The cryptocurrency market may experience more ups and downs in the future, but the long-term prospects are still promising.
