The German and US governments recently shifted a substantial sum of crypto, hinting at possible market adjustments as enthusiasts anticipate a rebound in July. This strategic movement occurs during a period typically marked by market optimism following historical declines in June.
The anticipation of a July recovery continues, with stakeholders eager to understand how these governmental activities will influence the market.
What Factors Are a Threat to Bitcoin’s July Recovery?
The German government’s crypto wallet executed a significant transfer, moving 1,500 Bitcoin (BTC) approximately worth $94.7 million. Of this, 400 BTC worth $25.3 million were sent to major crypto exchanges such as Bitstamp, Coinbase, and Kraken. This suggests that the German government might plan to sell the 400 BTC.
Since June 19, 2024, Germany’s net cryptocurrency transfers have totaled 5,167 BTC, representing about $330.3 million at an average price of $63,924. Presently, the crypto wallet maintains a substantial holding of 44,692 BTC, valued at roughly $2.81 billion.
Read more: Who Owns the Most Bitcoin in 2024?
Similarly, the US government has transferred 3,375 Ethereum (ETH) valued at $11.75 million to a fresh crypto wallet – 0x5ac. This marks the first significant ETH transfer since April 4, 2024, when the US moved 4,567 ETH worth $15.2 million. Despite these activities, the US still holds 49,320 ETH, now valued at $172 million.
The recent transactions by both governments amount to $106.45 million combined. These governmental moves have sparked discussions regarding their potential market effects. While these individual transactions might not directly impact prices, continued selling by these governments could pressure the market downward.
“The Government surely knows something,” crypto analyst Edo Farina speculated.
The speculation suggests that insider insights might drive these actions.
In an interview with BeInCrypto, Andrey Stoychev, the Head of Prime Brokerage at Nexo, discussed the impact of the government selling crypto.
“Government sell-offs are usually characterized by temporary spikes in volatility combined with price drops as markets respond to sudden increases in supply. After that, the market absorbs the excess supply and becomes stable again.Timing and market conditions play a key role here. To minimize disruption, governments often choose strategically and sell during times of market strength,” Stoychev told BeInCrypto.
Nonetheless, the crypto community is anticipating a bullish July. Historical data from Coinglass supports this, showing that Bitcoin, which dropped nearly 7% from $67,540 to $62,772 this June, has traditionally bounced back in July with significant gains.
Read more: Bitcoin (BTC) Price Prediction 2024/2025/2030
Moreover, the ongoing Mt. Gox saga adds another layer of complexity to the market. Last week’s announcement that Mt. Gox would start Bitcoin and Bitcoin Cash (BCH) repayments in July 2024 is expected to prompt a sell-off, potentially affecting market prices.
“Bitcoin tends toward strong performance in July, but Mt. Gox is weighing on hopes of a rebound,” crypto influencer Ajay Kashyap said.
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