Since June, the BTC market has seen multiple “whale sales.” Recently, there is news that the German government is also selling off its BTC holdings. Due to the huge scale of transactions, the government's selling can be classified as a "whale trend . " Many market participants also claimed that they contributed to the increase in selling pressure and the decline in BTC prices.
However, Ki Young Ju, founder and CEO of CryptoQuant, disagrees with this view. He believes the reaction of government-linked wallets to the sell-off is mostly overestimated. Interestingly, his opinion is based on the cumulative value of BTC inflows over the past year.
In total, over the past two weeks, addresses associated with the U.S. and German governments have transferred more than $737 million worth of BTC to crypto asset exchanges Coinbase, Bitstamp, and Kraken. In essence, these transfers are nothing more than selling on exchanges . Notably, these transfers occurred during a month-long decline in BTC prices, adding to the selling pressure.
However, while headlines about “government dumping of BTC” may spark fear, uncertainty, and anxiety in the crypto asset community, in the grand scheme of things, the volume of the selling is actually modest .
According to CryptoQuant information shared by Ki Young Ju, BTC has received more than $224 billion in capital inflows since 2023, only 4% of which is related to assets seized by the government.
In addition, the data also shows that since 2023, BTC seized by the government has contributed approximately $9 billion to the realized market value. Judging from this realized market capitalization information, the BTC owned by the government obviously does not have much energy and is insignificant compared to the funds on the market .
Realized market cap is a unique way of looking at the true valuation of BTC. It takes into account the price of each BTC when it last moved from its current position, giving a more accurate reflection of how much fiat currency has flowed into BTC.
