Germany Still Holds $2.2 Billion in Bitcoin: A Persistent Threat?

Germany still holds 39,826 bitcoins, valued at $2.2 billion, despite recent sales that have shaken the market. This reserve, representing a significant part of the daily bitcoin trading volume, raises the specter of further turbulence.

The controversial management of seized bitcoins

Since mid-June, the German government has liquidated more than 10,000 bitcoins, the result of a judicial seizure from the operators of the Movie2k.to site. This operation has had significant repercussions on the market, leading to a nearly 20% drop in the price of bitcoin within just a month.

The impact was felt beyond bitcoin: the CoinDesk 20 index, a broader measure of the crypto market, recorded a 14% drop in one week. 

Despite these massive sales, Germany still holds a substantial portfolio. According to data from Arkham Intelligence, the country still holds 39,826 bitcoins, valued at $2.2 billion.

This liquidation strategy has provoked mixed reactions within the crypto community. Justin Sun, founder of Tron, proposed an alternative solution by suggesting the acquisition of bitcoins off-market, in order to limit downward pressure.

A debate on the future of cryptos in Germany

The management of this bitcoin reserve raises fundamental questions about Germany’s strategy regarding cryptos. Experts, notably from Blockware Intelligence, describe the massive liquidation of bitcoins as a “major strategic error.” 

Their main argument is based on the idea that a nation should prioritize holding rare digital assets, rather than converting them into fiat currency.

This position finds an echo within the German government itself. Joana Cotar, a prominent member of the Bundestag, has strongly criticized this approach. According to her, these sales risk compromising Germany’s geopolitical position in the long term. She advocates instead for keeping these bitcoins as a national strategic reserve, highlighting their future potential.

The impact of the German decision could extend beyond its borders, significantly influencing investor sentiment on a global scale. 

Furthermore, the remaining reserve of 39,826 BTC continues to exert considerable pressure on the market. Representing nearly 9% of the daily bitcoin trading volume, it poses a potential threat to prices, fueling uncertainty about the future of the crypto market.