Bitcoin Forum

Recent discussions have centered around the potential consequences of the German government offloading 50,000 Bitcoin on the crypto market ^[1]. This scenario bears striking similarities to a previous incident in England during 1999.

The German government's decision to offload its Bitcoin holdings at a price below 60K USD echoes the controversial sale of UK gold reserves in 1999. As one of the world's largest sovereign BTC holders, Germany's divestment at this relatively low price point has raised concerns among financial analysts. Some experts are even comparing this move to the UK's gold sale, suggesting it could be a similarly detrimental financial strategy ^[2].

The recent approval of spot Bitcoin ETFs marks a pivotal moment, broadening BTC accessibility and potentially attracting substantial institutional investment. I anticipate sustained BTC price growth through 2025. Given this bullish outlook, Germany's decision to offload its BTC holdings could prove short-sighted. There's a possibility that government officials may reconsider this strategy, potentially opting to retain BTC as a national asset rather than liquidating it via OTC.

I would like to know your opinion on this issue:

• Do you think the German government's BTC sell-off was a historical mistake?
• If you could help the German government make a decision, would you like to turn this 50K BTC into a national reserve?
• Do you continue to believe in BTC price growth opportunities in the near future to become an extremely valuable asset in the economy?

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References:
[1] Germany Almost Done Selling Bitcoin, Holding Less Than 5K Tokens After Latest Moves (https://www.coindesk.com/markets/2024/07/11/germany-almost-done-selling-bitcoin-holding-less-than-5k-tokens-after-latest-moves/)
[2] German Government Bitcoin Selling Akin To UK Selling Its Gold (https://cryptodaily.co.uk/2024/07/german-government-bitcoin-selling-akin-to-uk-selling-its-gold)

It's difficult to say as we have no idea about what exactly is happening in their government. I am not well aware of their laws but it could be a possibility that they had to do this to comply. Or maybe they are going to use it for something urgent. Who knows? As investors we would always see this as a mistake but how they use it could show whether it was really a mistake or not.
No. Bitcoin is too volatile right now to be used as a reserve and stabilize their economy.
Yes which is why I continue to hold my bitcoins unlike Germany ;D

I've tried to find this information online but failed to do so. I think I saw somewhere on the forum that there are rules and timelines in Germany (or perhaps in Saxony specifically) about how fast seized assets must be sold and that Saxony is only following the rules by selling its BTC now. Perhaps someone could find a source on that; I would greatly appreciate it.
If that's true, then Germany is selling regardless of the price. Even if that isn't true, the current price is still fantastic, among the best BTC prices in its history, so I don't think they're making a mistake by selling now. Besides, you never know with Bitcoin: the price can easily be $40k in a couple of months, so waiting for a better moment can be risky.

They are selling or liquidating these bitcoins according to existing laws and rules in my guess, like you. As government, they do their jobs based on current active existing laws and rules, and don't hold bitcoins as own investments.

Someone live in Germany and understand their laws better, can give us more details but I bet that my theory is true.

The current price, even below $60,000 is amazing because yearly candles (https://charts.bitbo.io/yearly-candles/) chart shows that in 2021, the ATH of a previous cycle is $67,549 and today Bitcoin is exchanging with price about $58,100. It is only 14% from 2021 ATH and if in this current cycle, Bitcoin did not make its new ATH before a halving in April, current price is very good.

In addition, the Bitcoin bull run will continue.

1. The difference is that at that time gold was already a global reserve asset and considered the most reliable asset that any country would want to own. Therefore, the decision to sell more than 50% of gold reserves is really a wrong decision by the British Government even though we do not know the reason behind it.
Meanwhile, bitcoin remains a volatile asset and is not a national reserve asset nor does it account for too much of the German government's budget. There was a huge difference between the British government's sale of gold at the time and the German government's sale of bitcoin.

2. So far, no country has dared to turn bitcoin into a national reserve asset because of its volatility, so using bitcoin as a national reserve at this stage is somewhat risky for the economy.

3. As a bitcoin investor, everyone wants the value of bitcoin to skyrocket, but the future is unpredictable.

I don't understand why people nowadays really like to getting involved in someone else business, please mind your own business, if they want to sell their coins, let they go. It's their own choice to sell their coins, why we need to hope other people to sell their coins during x price or x time?

There's nothing wrong for them doing that, same to Laszlo who spent 10,000 Bitcoins to buy 2 pizzas, yet people still saying he's stupid. Laszlo was the one who make Bitcoin price can be so high.

Why would that be a historical mistake? They got all that BTC for free, they didn't even have to bother too much because after the investigation, the "criminals" voluntarily sent them BTC. Besides, what impact does a few billion $ have on the economy of a country that has an annual budget of $4+ trillion?

You forgot to add China to the whole story, because some persistently repeated that China also made the wrong move when it banned BTC - but even if they had all the BTC that exists and had a 100% share in mining, for such a huge economy it would not means too much.

Perhaps this amount helped them to close some budget holes that would later cause greater losses than the profits that would bring a potential increase in the price of Bitcoin.

Why do a large number of Bitcoin holders think that the only right thing to do is to keep Bitcoin? Which holding period is best, 10, 50 or 100 years? Every cycle has its beginning and end and whenever the German government sold its Bitcoin, one could always question whether they should have waited longer. In the end, they got them for free, and most likely there will be more free Bitcoin for them in the future.

Your title says 2019.

1 - History studies events over time and it will be possible to evaluate events from the perspective of historical error only after time. It is now impossible to say for sure whether the German government's move was a mistake.

Although I am sure that most of the BTC-community will condemn these actions, believing that bitcoin will continue to rise in price. But even with the sale of BTC by the German government now, they found themselves in a huge profit (money out of thin air), because these bitcoins were received for free (confiscated).

2 -  It’s difficult for me to say, because I don’t know the internal economic situation in Germany, what to make a decision about holding bitcoin (there are other reserves) or selling right now (reserves are running out).

3 - All direct and indirect indicators indicate this.

The way I see it, they took the coins from a movie sharing platform in January and started dumping it in June. Most likely they had no way of holding it or thought it posed a risk and made them vulnerable. What if someone were to gain access to it due to a clerk's mistake and steal it? The government would become a laughingstock, they would have a problem tracking the thief, wouldn't be able to block or blacklist the money like they can do with fiat money...
I also believe this is part of some speculation by them. I wouldn't be surprised if the employees of the office tasked with selling bitcoin had shorts on bitcoin futures set up before they started dumping on spot, which is exactly why they did not do what the FBI did many times before and put seized coins on auction. They wanted to influence the spot market. Maybe for their own benefit, maybe under pressure from EU central bank who as we all know hates crypto.
Was this a mistake? I don't think so. If they really wanted to hold enough bitcoin that could mean anything to a country, they'd need to go way beyond 100k coins. They'd need to invest at least 1% of GDP every year.

To simplify it like if anyone, any entity sells anything and years later, its price goes up a lot, it means that person, entity made historical mistake.

I am sorry but no, it's not historical mistake because at different point of time or period of time, a person or entity has specific need and has to do most appropriate decisions. Years later, looking back, don't see it as mistake if at the time you sell anything, it helped you to solve some problems in your life.

But to avoid regret, to buy massive chance in future, you can reserve a small part as your lottery ticket to future. Like if you can not hold all or most of your bitcoin, you can reserve 1%, 5% or 10% of it, as a bet for future. It might help or might not help, but time will tell you about result of this approach.

my thinking after reading the OP was that it will turn out to be a historical mistake
within the next 12 months or so and I'm thinking they couldnt have been desperate
enough for the proceeds from the sale not to wait less than a year.....

unless someone in the decision making was fearful Bitcoin was going to ""ZERO""

Definitely no rules on how long anyone should HODL but the timing of the sales was
not the most opportune even if it is 100% profit.
I'm taking it that the German government

I think that the error with the prefix historical requires a slightly longer period of 12 months. The German economy has a rather long and complex history for one decision in 12 months to have such weight.
They have already waited for a certain period, why would they wait another year? Because forum users think it's better that way?

It should also be kept in mind that the German government's decision to sell Bitcoin is not simple, and it certainly did not happen that the decision was made today and the next day Bitcoin went on sale. It is very possible that the initiative was launched approximately at the time of ATH, but a period of obtaining the consent of all authorities, ratification in the parliament or whatever process was needed. A process that certainly lasts a certain period.

Its a pity for Germany really that they don't see the value in the Bitcoin but hey maybe they just needed the cash for something?? I definitely think it was a huge mistake for them and that they will realize that down the road but for now i'm sure the government officials are all sitting in some huge bungalow drinking german beers thinking what a great decision they made. 

I don't know the motives behind the German government selling all of its Bitcoin. They started selling and did not stop until they emptied the entire wallet. Do they really need this money? Or do they want to get rid of Bitcoin for other reasons? No one knows exactly.

I do not know if the German government made a historical mistake by selling all of its bitcoins, but they certainly have strong reasons for doing so. I also do not expect that keeping these quantities would have a major economic role in a rich and economically strong country like Germany. If it were another smaller country, it would certainly have been a mistake. Historically, but for Germany I don't think so.

There are many German users on this forum, I'll be glad if someone explains how this goes and I'll add some more questions in this thread.

First of all, when the government seizes Bitcoin, who makes the decision on how to save the wallet keys? And who is about to take care of that? Who is responsible for Bitcoins going from the seized wallet? Who has control over wallet private keys?

Second of all, who decides to sell those confiscated coins? Can the government hold the seized assets as long as it wants? If yes, then who decides when to sell it and at in what price? In my country, there is an online auction and everything is sold in the auction. As I see, the German government sold them manually on different exchanges.


Btw OP, this sell was not a historical mistake, they sold it at 58K or something like that, not at 500$. Selling at ATH would be nice but it's still not something they need to worry about, and it's still a decent profit.

Is hard to know if it was a mistake because we don't know what are they doing with that capital, maybe they invest in something with a better revenue. But I would bet they will put that money on war.

The se days are complex for europe, the ww3 feels really close nowadays. They need money for it.

Frankly, I don't even know because Bitcoin's price is still relatively higher than when they first started selling bitcoin (mid 60K price level) so if they buy back now, it won't be a mistake after all. Worth noting that those Bitcoins were seized when Bitcoin's price was dead cheap.


Definitely a reserve but not just passively. Sell a part of the reserve as perceived top levels and buy back on any pull back. Bitcoin is going to be very valuable in the future, we might just accumulate enough of it while holding. Good plan imo.


Same as above. Like businesses and firms, countries too need good assets as much as they have liabilities. Bitcoin would make a fine asset for any country's economy.

How did you come to the conclusion that it was a mistake selling Gold by 2019? It could be their target price to sell even though the price went further. That might also be the case with the German government with bitcoin, they might just be selling at a price they felt was fine for their target. We cannot possibly call their targets a mistake. Well, holding bitcoin would have actually been a better option for the German government unless they sold with plans to buy back.

1.I don't think that this was a "historical mistake". Do you remember the BTC price in July 2023? I don't remember the exact price, but I remember that it was in the range of 25-30K USD. Selling BTC at 55K-59K USD seems like a good deal for the German government.
I don't really believe that the German government would be HODLing BTC and waiting for the price to hit 100K only for the sake of maximizing profits. This is a government, not a private investor, so maximizing the profit isn't the main goal here.
2.I don't care if any government in the world would keep BTC as a national reserve.
3.Yes, there will be more BTC bull runs in the future. The Federal Reserve is going to decrease the interest rates and the financial markets will be flooded again with easy money, which means higher crypto prices.

While reading the article you referred to, I found out "It's Not Germany Selling Bitcoin. It's One of Its States and It Has No Choice"
It's not the country of Germany that's been selling millions of dollars worth of bitcoin, but a small German state called Saxony.
The state confiscated almost 50,000 BTC in January and has been selling its holdings as per standard practice for assets seized during criminal investigations, an expert said.

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https://www.coindesk.com/news-analysis/2024/07/09/its-not-germany-thats-selling-bitcoin-its-one-of-its-states-and-it-has-no-choice/

@Learn Bitcoin, well explained, some misconceptions have now been dispelled and we know exactly what happened. It is important that the coins have been sold and that this whole drama is behind us, and that in the future everyone knows that in most countries seized cryptocurrencies must be sold sooner or later.

National states (especially rich ones) simply do not want to invest in BTC, because that would send a message to their citizens, who would then certainly invest much more in BTC than is the case today.

Bitcoin investment is a business where people, institutions and governments can buy and sale it. I'm personally not making a bid deal about why the German government should sale their BTC at this time, the important thing is if they're selling at profit, if the Bitcoin were seized or they bought when price was $20k and are offloading it now, then I think that they're not doing so at a lose. They will probably divert or reinvest the funds gotten from their sale of Bitcoin into another asset that will benefit their economy, it's not necessary for them to hodl Bitcoin as a national reserve.

Spain also sold gold in 2007 because the finance minister at the time, shortly before a bull market started. In total they cashed in some €2 billion, which today would be €7.5 billion, but don't ask a politician to be long-winded, and they are derisory amounts within the budget they manage. Spain's GDP is around 1,500 trillion USD and the budget they manage is €700 billion. €2 billion is nothing for their finances and even less so considering they are under the umbrella of the ECB printing press.

In this particular case, the bitcoin issue has been well clarified by Learn Bitcoin.

So, in general, I don't think we can talk about mistakes. It is not as if someone with an average salary bought 10 bitcoins in 2013 and sold them at a loss. That would be a mistake, because holding a few years could have changed their life completely.

Ah I know that this is but a snapshot in the timeline of the German government,
and yea 12 months maybe doesnt fall into a category of historical mistake but in
my book - selling for the sake of offloading their Bitcoin will definitely prove something,
Mistake, error, regret, short sighted?

To me it seems like something they saw as a burden and needed to be rid of it.
Just as many others see Bitcoin in an opposite frame.

If their finances in some department are under pressure and needed a boost
well then having something you got for nothing and selling it makes total sense too,
but I dont know if that was the case.

just my thoughts.

Why the sudden everyone on this thread is giving explanation related to gold. Are you guys comparing a digital asset with a physical asset. Gold can be seen and experience while Bitcoin is just a number with value. The more you guys who have replied on this thread reminds me the comparison some one did about Gold and Bitcoin.

They are not the same and if a government wants to sell Bitcoin that they got because it was used for illegal activities does not mean they cannot sell it. The sell off is being done to help those victims but the community is still thinking it is hurting Bitcoin.


.

Germany selling Bitcoin? common government stupidity. They are overlooking the whole picture, the great potential of it. Indeed, from a quick-buck standpoint, perhaps that makes sense to them now. Bitcoin is here to stay. Its bigger than any government, any short-term market fluctuation. This is the direction finance is headed.

Imagine Germany keeping those Bitcoins as a national reserve instead of letting go. Leading the push into the twenty-first century, they would be demonstrating to the globe how to welcome creativity and big thinking. But again, what do I know? Simply said, Im a guy who appreciates the true value and long-lasting influence. ETFs, general acceptance, all of this is happening. So while politicians are busy playing their little games, I'll be betting on Bitcoin. At the end of the day, its more about the substance than about the buzz. And Bitcoin? It has spades' worth of substance.

I love how suddenly every single shitposter every 3rd rate author paid pennies per lines suddenly knows the German government is making a mistake and they obviously know better, holding coins would have, what? It's hilarious how suddenly everyone cares about their economy when in reality it's just frustration because the price went down and the BAK sold instead of them!

People who haven't run an icecream stand in their life now are experts in macroeconomics!


Oh no!!! You're not going to tell me that the Chinese economy didn't crash after banning mining? I thought they would default after that move, we all know how....oh wait!
But I'm grabbing my popcorn for the time when Saylor dumps his load to get some profits, there will be a ton of Pikachu faces then!

Chinese economy had problems and if it collapses, their government can not blame it on Bitcoin or their own decision to ban Bitcoin mining as a core reason of the national economic collapse.

There is smart person like Li Ka-shing who smelt something bad in China since the power switch to Xi Jinping
Li Ka-Shing Moves Investments Out of China (https://www.thechinastory.org/yearbooks/yearbook-2015/forum-the-well-%E4%BA%95/li-ka-shing-moves-investments-out-of-china/).

Years ago, he smelt that Xi Jinping did not care much about economy but about army, political power and narcissism.

That's not the point!
The thing is that everyone was just as angry then and saying bullshit as to how much China will lose from bitcoin mining yet we see nothing happened, and all these countries where mining has moved don't seem to fare that better! Or are you telling me that now that the US holds the majority this will help the economy and suddenly post a surplus?

People really need to understand that for now, Bitcoin is a drop in the ocean, that's reality!
Another just as real reality is that despite bitcoin Salvador had the lowest GDP growth in all of Central America for two consecutive years!

We're talking about a 4 trillion economy and people think 2 or 4 billion would change something, lol!

You say the truth, I agree.

Thinking Bitcoin is big enough to change something or many things include big ones is from Bitcoin maximalists like Bitcoin will fix A and B, fix government, economy, society, fix fiat currencies and more. It's all unrealistic, I agree with you.

The small size of Bitcoin market gives chance to people who want to make hype, that Bitcoin market is very smaller compares to other market, trillion economy, and if small parts of these things flow into Bitcoin market, it's massive.

It's pure theory and any big assumptions behind that, some can be unrealistic too.

Well, the last update is that the German States are Done selling their Bitcoin, and their Bitcoin balance is less than 0.005 BTC. Right after publishing the news, the market started to move upward again, and Bitcoin broke the 62K range and stood at 62.8K when writing this post. Now the question is, what next?

Mt. Gox will start distributing Bitcoin to the users, and it is likely to take another two months. What do you guys expect in these two months? I am kind of sure that we will see another dip once Mt. Gox users start getting their payments.

News worth reading about German Bitcoin Balance;
https://cointelegraph.com/news/what-s-next-for-bitcoin-price-now-that-german-gov-t-btc-balance-hits-zero
https://news.bitcoin.com/german-governments-bitcoin-holdings-swell-overnight-thanks-to-donations/

That's a great news, and although many of us here were kinda expecting the change in the course of BTC for this or that reason, when it really happens it's always a great news. Because being inside a community of Bitcoin admirers it's always a bit risky, you know, you can lose the track of what's really going on, so it's a good practice to check it from time to time. I'm glad that not only in the words of people of this forum, but in reality Bitcoin is doing well.

As many people have pointed out, that amount of bitcoin is only worth a few billion dollars, and even if they held it for many more years, its value would increase five or tenfold. But when compared to GDP or the trillion-dollar budget of the German government, it is just a grain of salt. Don't make lame comparisons and conclude that the German government is stupid when they are trying to sell bitcoin while you are accumulating bitcoin.

I do not deny the potential of bitcoin, it has a significant impact on the economy of individuals, organizations...but when looking at the bigger picture such as the national economy like Germany or the world, bitcoin is nothing at present.

We will never know until we see the price of Bitcoin goes to the point that we're all satisfied. But with this, the current decision of theirs is not going to be said as a mistake if they have a purpose for its sell off.

I don't want to give help. I don't even held that kind of amount so let alone their own government solve and do whatever they want with that amount. They have the rights to do what they think is right and they're a government and not some kind of us that will hold forever.

Isn't it a valuable asset nowadays? or even some few years ago? Many still don't see that value on it? I guess so.

Saxony has been selling all its bitcoin as per standard practice for assets seized from criminal investigations, so that means this is not a mistake but has already been planned ahead regardless of the btc price movement in the market. And I have to agree with this that selling at the current price is not a loss at all, but a smart move before its price drops drastically any time.

It's hard to explain to someone what some like you have been saying for years - that all the BTC that has been mined is worth so little on a global scale that it's completely ridiculous to put it in the context of a country like Germany. What I've noticed is that there are a lot of people who don't understand the difference between a billion and a trillion, which is still elementary math, isn't it?


Bitcoin cannot solve decades of corruption and mismanagement of any country, everyone who thought otherwise might be surprised when they look at the actual numbers. If I've learned anything in my life, it's the fact that forcing someone to do something they don't want sooner or later ends badly - and Bitcoin as a legal tender seemed like a bad idea to me from the beginning.

Couldn't say. The fact of the matter is, as much as we love bitcoin and assume that it would just stay forever, bitcoin's still an infant compared to the longevity and the legacy that gold has made so far in its couple thousand years run. It's just not gonna square up that way. And even now that we're at one of its highest points arguably we're still at a loss/fear about whether it's gonna hold up this season or not, given the fact that crashes upon crashes and a lot of lack of movement has happened after a pretty active run.

So In that regard I don't think Germany's making a historical mistake right here. Bitcoin as it stands today is a one and done type of investment wherein you dip and bounce as soon as you get the amount you want. And it feels like Germany just got that money.

This is one of my biggest fear as a bitcoin enthusiast myself, the cryptocurrency being reduced to nothing but a pump and dump scheme with us being the exit liquidity to these giant companies and countries, but oh well. Least we got that ETF right?

There is a misconception in one of the articles you referenced that the reason why the German government sold Bitcoin was because they wanted to manipulate the market to enable them to buy cheap Bitcoin. I don't think that's true because it became clear that the market cannot be manipulated by such a dump. The German state of Saxony sold Bitcoin because they thought it was the best time to sell. It seems they wanted to follow the guidelines set by the World Bank regarding the management of seized and confiscated assets.

1. Germany has some of the best economists in the world I doubt if this sell is a blunder. Maybe they want to invest the funds in a developmental project or it is possible that the state doesn't want it invest in Bitcoin. Bitcoin is not the only profitable investment in the world.

2. Almost on this forum will not sell such an asset at this time. Using Bitcoin as a reserve will depend on the financial laws of Germany. I would have advised them to keep the coins for a few more months.

3. We all believe that we are at the beginning of the bull run and there are projections that the price of Bitcoin will continue to grow till next year.

It is not a mistake from our point of view.

What we want is more distribution of bitcoin. The more the better. So when a single entity (including governments) own a large number of bitcoins, that is not a good thing. What's good is when they sell it which means it enters circulation again and there is a chance that those coins be spread among multiple entities which improves that distribution I mentioned.

Too lazy to read the entire picture but I always thought too much importance given to such selloffs (I mean, 50k? What's that but a minute drop). Why aren't people looking instead at why they're selling? Or what's it going to be used for?

I had to liquidate in 2020, just as price was recovering to 2017 highs. Market perspective only, I made a mistake. A year later, a new ATH. And then we had new ATHs recently. But I sold mine to fix some immediate issues. Got me to where I am today in my private life. Had I not sold, and not solved that issue, I'm certain my life would not be better today, Bitcoin or no Bitcoin.

That coin was an asset for them, unexpected revenue you can call it, since it was confiscated. It's not the birds in the bushes, but the one in your hand, when it comes to state revenue sometimes.

No, how could it be a mistake when all they do is follow the country's law liquidating assets involved in criminal activities.  Besides, the government got the BTC for free, selling it would be a profit for the institution and would someone thinks that it is a mistake to liquidate free BTC to be used for government activities?  I believe only greedy people think that way.



Its a free money why not?  Besides, when it comes to government, decisions must be bound by laws.  If the government law states that confiscated criminal funds or assets should be liquidated then there is nothing to do here but follow that law.


The Bitcoin market/cryptocurrency industry is still young at a decade+ old.  The market is yet to be saturated even though majority of the supply was mined.  Being the market not saturated means there is a lot of room for the Bitcoin market to grow.  Although, it is too early to say that Bitcoin will be an extremely valuable asset in the economy, at least for now we can see that the Bitcoin market is progressing...[/list]

This could be the government of Germany lack of proper understanding of Bitcoin, because I wouldn't see reason for a government who has got a better knowledge about Bitcoin to have sold such an amount of Bitcoin, Taking El Salvadors government for example who adopted Bitcoin as a legal tender in the past couple of years has kept increasing their Bitcoin portfolio, well just as many have said,  I think this could be as a result of how the Bitcoin got into their hands.

I wouldn't consider any sell of government's BTC a historical mistakes, I mean it's their own decision, and by that time, they couldn't care of what the price will be, as long as they are going to offload it and have the money, then good for them. And perhaps they don't think that Bitcoin could be a hedge or a reserved that's why government around the world are selling it.

Nah, as I have said, no one think that Bitcoin could be a national reserved, they will still to the old and traditional Gold.

Of course, as a Bitcoin enthusiast, we have been in the market and witness several halvings already, Bitcoin is going to be a valuable assets to us. Although global adoption is slow, but it doesn't matter. The aim here is to be inside the market, be an early adopter, similar to those who have been in the market in the beginning. And at least you have the advantage from those who will going to enter in the latter stage.