In the film Die Hard, East German criminal mastermind Hans Gruber took over Nakatomi Plaza in a plot to steal over half a billion dollars in bearer bonds — worth $1.7 billion in today’s money.
Three and a half years later, Germany has returned, grabbing all our attention while liquidating billions of bitcoin.
Bitcoin was taken earlier this year by the operator of Movie2k. This defunct piracy site shut down in 2013 had been operating since 2007. Germany assumed nearly 50,000 BTC, which is worth $2.86 billion at current prices. The amount was $2.15 billion at the time of first reports and around $25 million at Movie2k’s peak.
Arkham Intelligence’s data shows that Germany sent over 2 billion dollars in bitcoin to trading platforms between June 16 and today, including addresses which were not identified but are believed to be OTC desks.
Earlier in the morning, addresses connected to the Bundesregierung sent 6,306 BTC (361,3 million USD) to Kraken’s Exchange, Cumberland DRW (a market maker), and two entities that appeared to be associated with over-the-counter platforms or similar platforms.
On Monday, however, the same addresses sent an incredible 16,038 BTC (920 million dollars) to Kraken and Cumberland DRW, as well as other trading platforms including Bitstamp Flow Traders, and Coinbase.
The easiest explanation for these transfers is that government officials are selling bitcoins seized, just as the US Government does occasionally.
Germany’s wallets received back bitcoin worth $508.6 Million from the trading platforms at each transfer.
Take yesterday for example: Out of the $920 million worth of bitcoin that was sent to trading platforms on Tuesday, Bitstamp received around $134,000,000 or 15%.
Earlier this morning — two hours before Germany’s latest round of exchange transfers — government wallets received 1,692 BTC ($97 million) back from Bitstamp. Kraken and Coinbase have also returned bitcoin chunks.
There’s no clear reason why Germany’s wallets are following these patterns. But perhaps the most important thing is that the outflows outweigh the current inflows.
If we assume that any bitcoins that haven’t been returned to German wallets were likely sold for fiat then Germany has already liquidated Movie2k bitcoins more than half way.
A broad estimation suggests Germany may have generated up to $1.54 billion from 27,014 BTC, with an implied price of $56,800 per coin — 1% below its current trade price. US authorities also sent $241.2 millions to Coinbase in June.
Germany has 22,846 BTC worth $1.31 billion, which is a large amount of money. CoinGecko currently reports a daily global bitcoin volume of about $32 billion.
With big spectacle liquidations such as these, it is difficult to determine which has a greater market impact: actual sales or chatter around them.
Bitcoin’s price may have dropped by as much 15 percent since Germany started to transfer to exchanges. But it’s difficult to say if Germany’s sales are directly responsible. BTC, after all, is currently in a retracement phase following its March high.
It doesn’t matter what you say. The result will be the same. It is important to note that Germany may turn out to be short-term the least dangerous bitcoin villain.
Mt Gox has more than five times as much bitcoin to distribute over the next few weeks to its creditors, including directly to cryptocurrency exchanges.
The US government, meanwhile, is sitting on even more seized bitcoin — over 50% more than Mt Gox’s remaining stash — equal to $12.67 billion.
A new threat may always arise in the UK Government, which has its own 61,245 BTC (about $3 billion).
Yippee ki‐yay, bitcoin stacker.
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