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The German government has transferred approximately 1,300 Bitcoin to major cryptocurrency exchanges, contributing to a sharp decline in Bitcoin's value and causing ripple effects across the broader crypto landscape.
According to data from Arkham Intelligence, the German authorities moved Bitcoin worth approximately $75 million to exchanges including Bitstamp, Coinbase, and Kraken around 10 a.m. Central European Time today.
This transfer marks one of the largest movements of Bitcoin by the German government to centralized exchanges in the last few weeks.
The sell-off has contributed to Bitcoin's price dropping below the critical 200-day simple moving average (SMA), a key technical indicator often used by traders to assess long-term trends.
Bitcoin reached a low of $56,952 in early European trading hours and is currently trading at $57,650, down 4.5% on the day.
The German government's Bitcoin portfolio, even after this substantial transfer, is still significant. Currently, the German Government holds a significant Bitcoin portfolio valued at $2.3 billion and consisting of 40.359K BTC.
However, recent market actions have led to a notable decrease in their portfolio value, which has dropped by $136.17 million, over the last 24 hours. But the sell-off has not been limited to Bitcoin.
QCP Capital reports that the entire cryptocurrency market is experiencing heavy selling pressure, with Bitcoin falling below the $60,000 support level.
"Yet another day of heavy selling pressure, causing BTC to fall below the 60k support level and reaching lows of 57,875," noted QCP Capital.
The report also highlighted signs of miner capitulation, a phenomenon historically associated with price bottoms, such as the significant hash rate drop in 2022 when Bitcoin traded down to $17,000.
Despite the ongoing sell-off, the options market remains optimistic, particularly for Ethereum.
"The options market is still optimistic as we continue to see interest heavily skewed towards ETH Calls for September and December expiries," QCP Capital added.
Additionally, the market is bracing for the impact of the upcoming Mt. Gox repayment.
According to Peter Chung, Head of Presto Research, the Mt. Gox Rehabilitation Trustee plans to distribute billions of dollars worth of BTC and BCH to creditors between July 1 and October 31, 2024.
This influx is expected to shift the supply/demand dynamics significantly.
"Our analysis shows that the selling pressure for BCH will be four times larger than for BTC," Chung explained, indicating a potential trading opportunity for those looking to navigate the market volatility.
Edited by Stacy Elliott.