Home Coin news Germany Misses Out on $120 Million Bitcoin Profit

Germany Misses Out on $120 Million Bitcoin Profit

22 Jul, 2024 Coin news

Germany Misses Out on $120 Million Bitcoin Profit

The German government recently missed out on an additional $124 million in Bitcoin gains by selling its holdings prematurely.

On July 13, Saxony state completed the sale of the 50,000 BTC seized from the movie piracy website movie2k, generating approximately $2.87 billion.

This sale resulted in a profit of over $740 million compared to their acquisition cost of $2.13 billion in January.

However, right after the sale, Bitcoin prices surged by up to 16.55%, driven by the assassination attempt on former U.S. President Donald Trump, which increased his chances of reelection in November.

The Saxony government could have maximized returns in March when BTC reached a record high of around $74,000.

Selling 50,000 BTC then could have secured $1.5 billion in profits.

Additionally, BTC’s 12% decline during the German government’s sales also led to missed profits.

The Dresden Public Prosecutor's Office ordered the "emergency sales" of Bitcoin in June, fearing the cryptocurrency's value might drop by more than 10%.

"The sale of valuable items before the conclusion of ongoing criminal proceedings is legally required whenever there is a risk of a significant loss of value of around ten percent or more," the office stated, adding:

"These conditions were always met with the volatile Bitcoins due to the enormous and extremely rapid price fluctuations."

The office emphasized that it is illegal for enforcement agencies to speculate on the value of seized items, and the intention behind the emergency sale of 50,000 BTC was to secure funds for criminal proceedings against movie2k.

"In this emergency sale, which was unprecedented in the Federal Republic of Germany, a fair market price was always achieved," the Dresden Attorney General's office wrote, noting:

"There was always considerable trading volume in the Bitcoin market."

This statement coincides with a rising demand for Bitcoin among ETF and other fund investors during the German government's BTC sales.

"Bitcoin saw the 5th largest weekly inflows on record with $1.35 billion, while short-Bitcoin saw the largest weekly outflows since April at $8.6 million," noted James Butterfill, a researcher at asset management firm CoinShares, for the week ending July 13.

Sources:

https://cointelegraph.com/news/germany-lost-124m-profit-selling-bitcoin

https://platform.arkhamintelligence.com/explorer/entity/germany

https://www.tradingview.com/symbols/BTCUSD/?exchange=CRYPTO

https://medienservice.sachsen.de/medien/news/1077662

https://blog.coinshares.com/volume-191-digital-asset-fund-flows-weekly-report-78ab8a02059e

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