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Can Bitcoin Withstand German Selloff?
Bitcoin (BTC) has faced huge fluctuations due to various macroeconomic factors and industry-related events. This month, the sale of seized Bitcoin by the German government continues to shape sentiments amid criticism from industry players. BTC price has fallen below $55,000, levels not seen in months after a surge in spot ETF inflows.
The government seized 49,857 BTC and began moving assets to multiple exchanges and centralized wallets, triggering broader sell-offs and liquidations. These outflows sent the crypto leader’s price tumbling, and altcoins in a similar direction. At press time, Bitcoin is trading at $57,219, down 0.42% over the past 24 hours.
German flows will increase selling pressure
A major debate on social media has been the impact of the Bitcoin sell-off in Germany and the activities of institutional investors. Of course, the massive sell-off and the shift of assets to exchanges will dampen sentiment, but some believe that the decline was too low. This is due to the increase in spots Bitcoin ETFs inflows that saw assets soar to an all-time high above $73,000.
Likewise, Peter Schiff poked holes in the narrative of institutional inflows, noting that firms could have offered to buy the assets to reduce the impact on the market. It should be noted that Justin Sun made an offer on X to buy the assets. As inflows into cryptocurrency exchanges continue, sentiments will remain low.
At the moment, the German government holds 39,826 BTC after selling around 10,000 assets with selling pressure accounting for over 10% of daily volumes.
Is there hope in sight?
Bitcoin users have criticized the German government’s sell-off in recent weeks. Prominent German lawmaker Joana Cotar has spoken out against hasty asset sales, suggesting a move into foreign exchange reserves. Bulls are also looking at potential interest rate cuts by the Federal Reserve to boost macro sentiment. This will see investors turn to risk assets and can drive prices higher. Cryptocurrency users are looking for the market cap to return above $2.5 trillion, which currently stands at $2.11 trillion.
Read also: The Week’s Biggest Crypto Winners and Losers
David is a financial news contributor with 4 years of experience in Blockchain and cryptocurrency. He is interested in learning about emerging technologies and has an eye for breaking news. Keeping up to date with trends, David has written in several niches including regulation, partnerships, cryptocurrency, stocks, NFTs, etc. Away from the financial markets, David enjoys cycling and horseback riding.