What’s next for Bitcoin as German government dries its holdings?

• 
  The
  German
  government
  may
  have
  sold
  all
  of
  its
  $2.9
  billion
  worth
  of
  Bitcoin.
• 
  Increased
  bearish
  pressure
  has
  seen
  the
  S&P
  500
  outperforming
  Bitcoin
  in
  the
  past
  five
  weeks.
• 
  On-chain
  data
  suggests
  Bitcoin
  has
  potentially
  reached
  a
  bottom
  and
  may
  rebound
  or
  face
  heavier
  corrections.

Bitcoin
(BTC)
investors
are
preparing
for
the
weeks
ahead
after
the
German
government
transferred
out
its
last
holdings
on
Friday.
While
the

outlook
appears
bearish
on
the
surface,
price
action
and
on-chain
data
reveal
deeper
insights
into
Bitcoin’s
new
shape.

Bitcoin’s
performance
has
more
to
it
than
meets
the
eye

The
German
government
has
potentially
sold
all
the
50,000
Bitcoin
seized
from
pirated
movie
website
Movie2k.to.
According
to
analytics
firm
Arkham
Intelligence,
the
government
transferred
its
last
BTC
tokens
—
3846.05
BTC
($223.81M)
—
to
Flow
Traders
and
139Po
(likely
institutional
deposit/OTC
service).

German
Goverment
BTC
Balance

When
the
German
government
began
transferring
the
tokens
to
several
exchanges,
including
Coinbase,
Kraken,
Bitstamp,
etc.,
last
month,
they
were
worth
about
$2.9
billion.

Despite
the
German
government
offloading
out
of
the
way,
Bitcoin
still
faces
several
headwinds,
including
Mt.
Gox
BTC
repayment,
miners
selling
to
cover
operation
costs
and
bearish
sentiments
surrounding
poor
historical
Q3
returns.
Data
from
Kaito
AI
shows
that
the
Bitcoin
sentiment
score
is
approaching
zero
and
has
reached
a
level
last
seen
when
BTC’s
price
was
around
$26,000.

Following
the
increased
bearish
narrative,
Bitcoin
has
diverged
from
the
general
US
stock
market
in
the
past
five
weeks.
While
Bitcoin
declined
about
19.4%
in
the
past
week,
the
S&P
500
rose
more
than
5%,
with
several
blue
chip

stocks
reaching
new
highs.
However,
BTC’s
lag
may
see
it
play
a
bullish
catch-up,
considering
crypto’s
largest
bull
run
often
occurs
with
little
or
no
reliance
on
the
equities
market,
according
to
crypto
analytics
firm
Santiment.

BTC,
Gold,
S&P
500
Price
Comparison

This
aligns
with
predictions
from
CryptoQuant,
which
highlights
that
Bitcoin
is
at
a
critical
juncture.
Bitcoin
reached
a
four-month
low
after
reaching
$53,000
last
week.
The
move
saw
both
long-term
and
short-term
holders
experience
losses
of
about
$1
billion
and
traders
facing
unrealized
margins
of
-17%
—
a
loss
level
last
seen
since
the
FTX
collapse
days.
These
two
factors
indicate
a
potential
price
bottom.

The
price
drop
also
saw
whales
buying
the
dip
as
their
holdings
are
growing
at
a
6.3%
month-to-month
rate.
Bitcoin
ETFs
also
saw
positive
net
flows
this
week,
indicating
high
buying
pressure
from
investors.

While
these
factors
prime
BTC
for
growth
in
the
coming
weeks,
CryptoQuant
noted
that
the
declining
USDT
market
cap
and
ongoing
miners’
sales
suggest

Bitcoin
may
either
“stabilize
at
a
local
bottom”
or
experience
heavy
corrections
like
that
of
summer
2021.

USDT
Market
Cap
Change
&
Bitcoin
Price