A cryptocurrency wallet associated with the German government, known as the “German Government (BKA)” wallet, has sold an additional $900 million worth of Bitcoin. This has raised concerns that the selling pressure from the wallet will cause the price of BTC to decrease.
On July 8, the wallet transferred approximately 16,309 Bitcoin in multiple transactions to various external addresses. This is the largest amount of Bitcoin liquidated in a single day by the wallet. Some of the transfers were made to popular crypto exchanges such as Bitstamp, Coinbase, and Kraken, as well as market makers Flow Traders and Cumberland DRW.
One of the largest transactions involved 3,500 BTC being sent to Flow Traders, while 200 BTC was sent to Kraken, 400 BTC to Bitstamp, and 400 BTC to Coinbase.
Furthermore, an additional 700 BTC, valued at over $38.5 million, was sent to a wallet labeled “139Po.” This wallet is still unknown, but it has previously received funds from the German government, including 550 BTC on July 2, 500 BTC on June 25, and 800 BTC on June 20.
Following these transfers, the price of Bitcoin experienced a significant drop during the European trading session. It fell by as much as 6.75%, going from a high of $58,200 to a low of $54,278. This occurred shortly after the last group of blockchain transactions, which brought the total Bitcoin liquidated to 8,700 BTC.
With these latest transfers, the German government has sold more than half of its Bitcoin holdings. According to data from Arkham Intelligence, its holdings have been reduced from 50,000 BTC to 23,788 BTC, with a total value of $1.3 billion, since it began selling off the digital asset in June.
This drop in Bitcoin price has led to a large number of liquidations across the crypto market. Coinglass data shows that a total of $425 million in leveraged positions have been liquidated, with $216 million of that being long liquidations.
In the past 24 hours alone, over $189 million in Bitcoin positions have been liquidated, $87 million of which occurred in the last 12 hours. Of these liquidations, $81 million were long BTC positions, while $107.97 million were short BTC liquidations.
Bitcoin seems to have found significant support at the $54,700 level. However, if it were to drop below this level, approximately $750 million worth of leveraged long positions across all exchanges would be liquidated, according to Coinglass data.
In addition to the German government’s selling, the repayment process for the creditors of the defunct crypto exchange Mt. Gox has also contributed to the selling pressure on Bitcoin. The trustee for the Mt. Gox bankruptcy estate has started repaying some of the creditors in Bitcoin and Bitcoin Cash through designated crypto exchanges. The total amount to be repaid is $9 billion worth of BTC and BCH.
Furthermore, news that Bitstamp plans to quickly distribute its portion of Bitcoin repayments to Mt. Gox creditors has added to the selling pressure. This is despite the fact that the exchange has up to two months to do so once it receives the coins.
Market participants still anticipate that Bitcoin prices will rise again and that the bull market will continue once the selling pressure from the Mt. Gox repayments and German government selling subsides.
As of now, Bitcoin is trading at $56,433, experiencing a 1.52% decrease over the past 24 hours.
Please note that this article does not provide investment advice or recommendations. Readers should conduct their own research and make informed decisions when it comes to investing and trading.