Bitcoin (BTC) and the broader crypto market are at risk of a further downtrend following a recent development involving the US and German governments. On-chain data suggests that both governments are looking to offload a substantial amount of their BTC holdings.
US Government Send $240 Million In Bitcoin To Coinbase Prime
On-chain analytics platform Arkham Intelligence revealed in an X (formerly Twitter) post that the US government had sent 3,940 BTC ($240 million) to Coinbase Prime. This has raised fears that the government may be looking to offload these crypto tokens, which would exert more selling pressure on the flagship crypto.
Arkham also revealed that this BTC formed part of the seizure from narcotics trafficker Banmeet Singh following his trial earlier this year. Interestingly, Singh is known to have sold drugs through the Silk Road marketplace, a dark web platform which the US government is known to have seized a substantial amount of Bitcoin from.
The US government has, in the past, offloaded some of the Silk Road BTC, which also led to significant selling pressure for the flagship crypto. Their last confirmed sale came in March when they offloaded 9,861 BTC ($216 million). They have yet to confirm the sale of the 3,940 BTC moved to Coinbase, which suggests it has yet to be sold.
Meanwhile, the US government isn’t the only one looking to dump on the market. Data from Arkham Intelligence shows that the German government recently transferred 125 BTC ($7.71 million) each to crypto exchanges Kraken and Bitstamp. This follows their recent transfer of 400 BTC ($24 million) to Kraken and Coinbase. Meanwhile, the German government also moved 1,000 BTC to an unknown address (139Po), which could be another crypto exchange.
The potential Bitcoin sale from the US and German governments is more worrisome, considering that Bitcoin is already facing massive selling pressure as it is. Bitcoinist recently reported that BTC miners have sold 30,000 BTC ($2 billion) this month alone, greatly contributing to the crypto’s massive decline since the month began.
Another Government Chooses To Hold
While the US and Governments continue to offload their Bitcoin holdings, another government, El Salvador, has instead chosen to keep accumulating the flagship crypto. El Salvador is known to have adopted Bitcoin as a legal tender since September 2021 and initiated a ‘1 Bitcoin a day program’ in November 2022, whereby they purchase 1 BTC every day.
Data from Arkham Intelligence shows that they have stuck to this policy and currently hold 5,794 BTC ($351.82 million). El Salvador has also continued to accumulate through foreign investments and its mining operations. Bitcoinist recently reported the government’s plans to create a Bitcoin bank to lure foreign investors with frictionless Bitcoin investment.
Featured image created with Dall.E, chart from Tradingview.com