The cryptocurrency market, particularly Bitcoin (BTC), may face increased downward pressure following transactions carried out by the governments of the USA and Germany. Recent on-chain data indicates these governments are transferring sizeable Bitcoin reserves, signaling potential market sales.
The US Government Transfers $240 Million Worth of Bitcoin to Coinbase Prime
According to the on-chain analysis service Arkham Intelligence, the US government has recently moved 3,940 BTC, which is around $240 million, to Coinbase Prime. This activity raises concerns that the government might be preparing to sell these assets, potentially leading to additional downward pressure on Bitcoin.
Arkham also noted that these Bitcoin tokens are part of those seized from convicted narcotics trafficker Banmeet Singh, known for his dealings through the infamous Silk Road on the dark web.
In March, the US government was confirmed to have sold 9,861 BTC ($216 million), causing significant market impact. The disposition of the recently transferred 3,940 BTC has not been confirmed, suggesting that the sale has not yet occurred.
Meanwhile, data from Arkham Intelligence shows that the German government is also moving Bitcoin to various exchanges, perhaps preparing for sale. They have recently transferred 125 BTC ($7.71 million) each to Kraken and Bitstamp, following an earlier transfer of 400 BTC ($24 million) to Kraken and Coinbase. Additionally, they shifted 1,000 BTC to an unidentified address, which could also be an exchange.
The looming sales from the US and German governments add to existing pressures on Bitcoin, which has already seen considerable outflows, with miners divesting 30,000 BTC ($2 billion) within the last month.
El Salvador Continues to Support Bitcoin
While the US and German governments divest their Bitcoin, El Salvador is holding firm in its support for the cryptocurrency. As a country that has given Bitcoin legal tender status since September 2021, El Salvador continues to adhere to its policy of purchasing 1 BTC daily.
Arkham Intelligence’s data indicates that El Salvador’s holding currently stands at 5,794 BTC, worth approximately $351.82 million. Their aggressive acquisition strategy includes foreign investments and Bitcoin mining. El Salvador is also in the process of developing a Bitcoin bank to attract foreign investors seeking hassle-free cryptocurrency investments.
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