Bitcoin (BTC) Price Braces for Potential Impact as US and German Governments Execute Transactions Involving Seized BTC Holdings

The Bitcoin price experienced significant turbulence as the US and German governments executed transactions involving seized Bitcoin (BTC) holdings, leading to another BTC retracement.

The Bitcoin price experienced another BTC retracement after the US and German governments carried out transactions involving their seized Bitcoin (BTC) holdings.

As reported by a market intelligence platform, the US government has transferred nearly 4,000 BTC to Coinbase, while the German government also engaged in substantial BTC transactions.

Bitcoin Price Braces For Potential Impact

Earlier this year, an Indian national named Banmeet Singh pleaded guilty to narcotics trafficking and money laundering charges. According to reports, Singh’s “criminal enterprise” sold and distributed controlled substances via “dark web platforms” like Silk Road 1, Silk Road 2, Alpha Bay, and Hansa.

The US government wallets, which had earlier received the confiscated BTC, deposited 3,940 BTC into Coinbase. This move to a centralized exchange (CEX) usually suggests selling the cryptocurrency. However, it’s important to note that Coinbase also offers custodial services for large institutional investors.

This raises the possibility that the confiscated BTC will be moved to Coinbase’s custody services for safekeeping, which may not impact the Bitcoin price recovery.

However, if the initial scenario involving the sale of the BTC in question does occur, recent activity, such as the large bitcoin influx to Coinbase and the pending movement of Mt. Gox BTC in early July, may impact the market.

Despite this, market expert Adam Cochran highlights the relatively small amount of BTC being sent and the use of Coinbase, which could indicate a slow auctioning process. This may help mitigate the potential negative effects on the market and the Bitcoin price.

German Government Continues BTC Liquidations

Alongside the US government’s actions, the German government is also continuing its efforts to liquidate substantial BTC holdings. According to data from blockchain analytics platforms like Arkham Intel, the Federal Criminal Police Office (BKA) carried out nine transactions involving approximately 2,786 BTC.

Over the past week, the Bitcoin price has already seen a 20% correction, but as these developments unfolded, BTC dropped to $61,000 after a slight recovery earlier in the day at $62,400.

Meanwhile, technical analyst Mags highlights the significance of the bull market support band in macro analysis. During previous bull cycles, these bands have acted as strong support and resistance.

In January 2023, BTC notably flipped these bands into support, and subsequent tests have resulted in favorable upside continuation. This suggests that while the market may be facing uncertainty due to government liquidations, ongoing technical analysis points towards the potential for a continuation of the macrobullish trend.

At the time of writing, the Bitcoin price is still down nearly 13% over the month, currently trading at $61,000.

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