Germany’s on-chain Bitcoin wallet balance has officially reached zero, indicating that the sell pressure from the European economic powerhouse is likely coming to an end. This news comes after weeks of a bearish narrative hanging over the crypto market, with on-chain indicators now suggesting that a local bottom is near. According to Arkham Intelligence, the government had just 4925 BTC ($282.45 million) remaining in its wallets as of late Thursday, down significantly from the 50,000 BTC it held as recently as June 19.
The recent outflows from Germany’s Bitcoin wallets mark the end of a significant selling spree by the government. This move comes at a time when the U.S. government has also been selling some of its seized coins from criminals, adding to the overall market fears surrounding events such as the repayment to creditors of the bankrupt Mt. Gox Bitcoin exchange. The combination of these factors, along with minimal demand growth from Bitcoin whales and a lack of stablecoin liquidity, led to a drop in Bitcoin’s price to $53,900, its largest pullback since reaching a high of $73,700 in March.
Online Bitcoin investors have had mixed reactions to Germany’s decision to sell off its seized BTC. While some are celebrating the completion of the selloff, others are criticizing the government for exchanging their coins for fiat currency. Reflexivity Research co-founder Will Clemente tweeted that Germany’s move may be seen as a strategic blunder in the future, while MicroStrategy’s executive chairman Michael Saylor subtly criticized the government on Twitter for selling their Bitcoin holdings.
With the sell-off now complete, on-chain analysts are suggesting that Bitcoin’s price is at a healthy entry point for new investors. Institutional investors have been accumulating BTC at the fastest rate since March, indicating that they may be taking advantage of the recent price drop to “buy the dip.” Additionally, short-term holders have been offloading their coins at a loss, which analysts see as a positive sign that market fear has peaked and that a price correction may be imminent.
Germany’s decision to empty its Bitcoin wallets has had a significant impact on the market, with the sell-off coinciding with a broader trend of institutional investors accumulating BTC. While the short-term effects of this move may have contributed to a drop in Bitcoin’s price, the long-term implications remain to be seen. As the market continues to fluctuate, it will be essential for investors to carefully monitor on-chain indicators and market trends to make informed decisions about their Bitcoin holdings.
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