German government: Not responsible for BTC's plunge! Over 90% of Bitcoins are sold through OTC transactions

This site (120bTC.coM): Since June 19, German government-related wallets have successively transferred nearly 50,000 Bitcoins to exchanges and market makers such as Coinbase, Kraken, and Bitstamp for sale until last weekend. Completely clear. It is considered to be one of the main reasons for the recent decline of Bitcoin in early July.

German Government: More than 90% of Bitcoins are sold through over-the-counter transactions

But just yesterday (17th), the German government made an announcement on the sale of Bitcoin, saying that the sale process lasted about 3.5 weeks During the period, they sold a total of nearly 50,000 Bitcoins and obtained approximately 2.64 billion euros in funds.

However, official documents emphasized that during this sale, less than 1% of the trading volume was initially completed through regular transactions, and more than 90% of Bitcoins were traded in market-friendly over-the-counter (OTC) transactions. ) method, saying that this method will not have a direct impact on the price of Bitcoin.

Looking back, the current round of decline in Bitcoin from the end of last month to the middle of this month seems to be another possibility due to the negative market sentiment caused by the German government’s sale and the start of repayments by the Mt. Gox exchange. This was caused by panic selling pressure from retail investors.

Mt.Gox’s repayment has become the biggest negative news in the near future

However, the biggest potential bad news for the market in the near future is the repayment that Mt.Gox is executing. After all, the amount is nearly three times that of the German government, and it will indeed be denominated in currency. form delivered to the creditor.

However, Galaxy Research Director Alex Thorn also analyzed and commented at the end of June that in the end the selling pressure on Bitcoin triggered by Mt. Gox will be smaller than expected.

He explained that since nearly 75% of creditors choose Earlypayout (subject to accepting 10% impairment), there will currently only be about 95,000 Bitcoins used for early payment of compensation (the remaining BTC will take longer Only paid):

• About 20,000 tokens belong to the claim fund

• 10,000 tokens belong to Bitcoinica BK

• The remaining approximately 65,000 tokens are owed to individual creditors

and He predicts that individual creditors will insist on holding Bitcoin more than the market expects:

• Creditors are mainly long-term Bitcoin holders. They are technology-savvy early adopters.

• Individual creditors have rejected attractive offers from claims funds over the years, suggesting they want their Bitcoin back rather than compensation denominated in US dollars.

• The capital gains tax implications of a sale will be significant. Even though only 15% of physical claims have been recovered as prices have increased, claim holders have gained 140x (in USD) on the Bitcoin they recovered since the bankruptcy.

So in summary, he believes that the selling pressure on Bitcoin will not be greater than investors imagine. As for the true situation of the market, it remains to be verified by time.

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