Key Points
- The German government has resumed transferring Bitcoin (BTC) to cryptocurrency exchanges and Over-the-Counter (OTC) trading desks.
- Wallets linked to the German government have moved approximately $344 million worth of BTC, causing concern amongst investors.
The German government has recommenced the transfer of Bitcoin (BTC) to both cryptocurrency exchanges and OTC trading desks. Blockchain analytics platform Arkham Intelligence has reported that crypto wallets associated with the German government have moved an estimated $344 million in BTC. This series of transfers has raised eyebrows amongst investors and the wider crypto market.
Breakdown of Bitcoin Transfers
To provide some context, around $73 million of this Bitcoin was directed to centralized exchanges. Kraken received as much as $44 million, while Coinbase Global Inc got $39 million in BTC.
In addition, $98 million was sent to crypto trading firms such as Amsterdam’s Flow Traders and Chicago’s Cumberland DRW. The former received $66 million in two transactions, and the latter received $31.5 million.
An unidentified wallet also received $132 million from the German government in two separate transactions. Interestingly, this isn’t the first time these wallet addresses have received Bitcoin from the German government. This week alone, the German government has moved nearly $1.3 billion worth of Bitcoin to the aforementioned platforms.
Large Amounts of Bitcoin Still Held
On Monday, the German government transferred a total of 4,900 BTC to Coinbase, Bitstamp, Kraken, Cumberland DRW, and Flow Traders. Cumberland DRW received as much as 133.723 BTC at the time. The total transfers made on Monday amounted to $900 million.
Following this significant Monday transfer, Arkham Intelligence reported that the German government still holds 32,488 BTC, estimated to be worth $1.855 billion. By the end of Tuesday, this had reduced to $1 billion. However, the German government received 3,673 Bitcoins from centralized exchanges to offset the Tuesday sale.
Potential Shift to OTC Sales
On-chain analytics platform Spot On Chain had previously speculated about a possible shift towards OTC sales for the German government’s Bitcoin transfers. The frequency and size of the transfers formed the basis for this speculation. Initially, the German government was making these transfers to only centralized exchanges.
However, as the transfers began to go to crypto market makers like Cumberland DRW and Flow Traders, the possibility of OTC transactions became more pronounced. For many investors, especially large institutions, OTC sales are a preferred option as it helps them minimize their risk.
This shift towards this form of transaction suggests that the German government may have recognized the negative impact its transfers have on the market. Plus, Bitcoin has improved significantly in the last 24 hours. The flagship cryptocurrency has registered a 2.29% increase in the past 24 hours and is trading at $58,634.72, according to CoinMarketCap data.
Joana Cotar, a German MP from Bundestag, believes her government should refrain from offloading Bitcoin. She suggests Germany should follow the example of countries that are trying to hold Bitcoin as a strategic reserve asset.
