Markets

Germany’s $2.8B Bitcoin Dump Is ‘Market Intervention’, Despite Obscure Legal Justifications

Published

9 months ago

19 July, 2024

Germany's $2.8B Bitcoin Dump Is 'Market Intervention', Despite Obscure Legal Justifications

The process by which Germany dumped the seized bitcoins is being called “market intervention” by experts because it caused a sell-off.
According to one observer, the law cited by authorities as the reason for the sale falls within a “thin legal gray line.”

Germany may have finally found a legal reason for releasing nearly $3 billion in bitcoin {{BTC}} onto the open market, but industry experts aren’t convinced by that rationale.

Germany seized around 50,000 bitcoins from cryptocurrency operator Film2k.toa website that the state of Saxony has found guilty of money laundering and other illegal activities. The state, with the help of Frankfurt-based German securities trading bank Bankhaus Scheich Wertpapierspezialist AG and the Federal Criminal Police Office, sold about 49,858 bitcoins between June 19 and July 12, securing €2.6 billion ($2.8 billion), according to a declaration on Wednesday.

The motion perplexed traders and put a lot of pressure on the price of bitcoin while authorities remained silent on the reasons behind the sell-off. The selling pressure was intensified at the time as the market was also wary of mass sell-offs. sale by creditors of Mt. Gox and faster liquidations by bitcoin miners.

Prices bottomed out earlier this month at around $53,500 after Saxony completed its liquidation process, but not before wreaking havoc on the market as BTC fell by more than 7% in June.

When authorities finally issued a statement this week, the process was called a “market-friendly sale” that “was gentle on the market.” The statement said that “a fair market price was always achieved” and asserted that “at this scale, there is no direct influence on the price of bitcoin.”

However, some experts are not convinced.

Romina Bungert, an advisor to Enzyme and former CFO of Centrifuge, told CoinDesk: “This is a perfect example of the kind of inadvertent malicious activity based on lack of expertise that can come from governments and authorities.” She added: “The way they handled this sell-off has moved the market and its intervention in the public market… So who will now have an incentive to hold this national authority accountable? Not the state.”

In an email to CoinDesk, Patrick Pintaske, attorney and press spokesman for the head of the Special Procedures Division (UA BV), said: “The emergency sale regulated by law means that we cannot wait to see if and how the market value will change. The economic value of the seized assets should be preserved as much as possible for later judicial confiscation.”

The story continues

Bad timing

The German regulator may have justified its decision to sell, but market observers have questioned the timing of the sale and the benefits to taxpayers.

Philipp Hartmannsgruber, a Bitcoin expert {{BTC}} who is not convinced by the rationale in Wednesday’s statement, said the sale netted about 600 million euros more than the BTC were worth when they were seized in January. “How much could the taxpayer have earned if the bitcoins had been held long-term? At the current exchange rate of around 60,000 euros for bitcoin, they would be worth around 390 million euros more today.”

Hartmannsgruber, who regularly advises politicians and authorities as a member of the board of the Blockchain Bundesverband e.V. (German Blockchain Association), specifically argued that the sale should not have been carried out “during the announcement that up to 140,000 bitcoins worth around $7.7 billion from the Mt. Gox case would hit the market,” although he stressed that perfect timing is never possible.

Hartmannsgruber also asked the authorities to identify the sources behind their claim that “less than one percent of the bitcoin market volume was regularly traded over-the-counter (OTC) and had “no direct influence on the price of bitcoin.”

“This may not be the case on July 8, 2024, when up to 16,309 BTC were sold for around €830 million,” he said. “If 16,300 bitcoins are sold in one day, this can have a huge impact under certain circumstances.”

Legal ‘grey line’

The statement said the authorities had no choice but to sell. However, some experts point to a gray area because the boundaries of when an emergency sale is required seem a little less clear. The court did not require the sale of bitcoin because the statement said the proceeding was only “provisionally secured” because the court concerned has not yet made a decision on confiscation that becomes legally binding.

The decision, the statement said, was made because “the sale of valuables prior to the conclusion of ongoing criminal proceedings is required by law whenever there is a risk of a significant loss of value of approximately ten percent or more.” It also argued that, given the volatility of the bitcoin market, “these conditions have always been met.”

And, in fact, the value of bitcoin drops by 10% in short periods of time quite often.

GSK lawyer and partner Timo Bernau said the authorities had relied on a general principle from legal precedent to justify their sale. “In German law, there is a general ban on speculation for public authorities. This ban on speculation with public funds stems from the budgetary principle of economic efficiency and economy,” Bernau said. pointing to a 2017 ruling by the Federal Court of Justice.

Bungert noted that there was a legal “gray line” because “the rules for this government agency on the management of digital assets are not covered by the existing set of rules.” Hartmannsgruber argued that authorities cited Section 111p of the Code of Criminal Procedure to suggest they had no choice but to sell the bitcoins. However, the law states that after “an item that has been seized … may be sold if there is a risk of its deterioration or significant loss of value.”

“The law therefore does not provide for an obligation, but simply an opportunity to sell. It is therefore questionable whether the divestment was legally required,” Hartmannsgruber said.

“Although there are legal reasons why the Attorney General’s Office acted in this way, if it was not obligated to do so, the question arises as to why it nevertheless acted in this way and why it presented its actions as an alleged duty.”

Omkar Godbole contributed to this report.

To know more: It is not Germany that is selling Bitcoin. It is one of its states and has no choice.

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Markets

Bitcoin, Ethereum See Red as Markets Crash on Volatility

Published

9 months ago

1 August, 2024

Financial Block Staff

Bitcoin, Ethereum See Red as Markets Crash on Volatility

Bitcoin AND Etherealalong with the rest of the top 10 cryptocurrencies by market cap, appear to be in hibernation on Thursday morning.

At the time of writing, the Bitcoin Price is still below $65,000 and 2.2% lower than it was this time yesterday, according to CoinGecko data. Things are worse for the Ethereum Pricewhich is 3.7% lower than 24 hours ago at $3,185.22. The drop in ETH’s price is identical to that of Lido Staked Ethereum (stETH), a liquid staking token for Ethereum.

In recent days, falling prices have led to the liquidation of derivative contracts worth $225 million, according to Coin glassAnd about half of that, about $100 million, was liquidated in the last 12 hours.

When a trader is liquidated, it means that their position in the market has been forcibly closed by an exchange or brokerage due to a margin call or insufficient collateral. Margin is especially important when it comes to leveraged positions, which allow traders to control a multiple of their deposit, such as opening a $10,000 position with only $1,000 in their account.

Now that Bitcoin has been in the red for three days in a row, there is a chance that the world’s oldest and largest cryptocurrency could sink even further, BRN analyst Valentin Fournier said in a note shared with Decrypt.

“Bitcoin has closed in the red for three days in a row, with one-way trading showing limited resistance from bulls. Ethereum had a slightly positive Monday with strong resistance from bears who have won the last two days,” he wrote. “This momentum could take BTC to the $62,500 resistance or even the $58,000 territories.”

Looking ahead, Fournier said BRN’s strategy will be to “reduce exposure to Bitcoin and Ethereum and find a better entry point after the dip.”

This is despite Federal Reserve Chairman Jerome Powell’s comments yesterday on interest rates being widely regarded as accommodating and indicative of FOMC rate cuts in September.

Singapore-based cryptocurrency trading firm QCP Capital said the rally in stocks, which sent the S&P 500 up 1.6% from Wednesday’s close, was not felt in cryptocurrency markets.

“Cryptocurrencies have seen a broad sell-off overnight and into this morning,” the firm wrote in a trading note. “The market remains poised as traders pay close attention to daily ETH ETF outflows and further supply pressure from Mt Gox and the US government.”

Meanwhile, the other top-ranking coins are showing mixed performance.

Solana (SOL) is down 7.2% since yesterday to $169.13. Things are even worse for its most popular meme coins. In the past 24 hours, the most popular meme coins Dogwifhat (WIF) are down 12% and BONK (BONK) is down 9%, according to CoinGecko data.

Their dog-themed competitor, Ethereum OG Dogecoin (DOGE), the only meme coin in Coingecko’s top 10, is down nearly 4% since yesterday and is currently trading at $0.1205.

XRP (XRP) dropped to $0.608, which is 7% lower than it was at this time yesterday.

Binance’s BNB Coin (BNB) has kept pace with BTC and is currently trading at $571, down 2.4% from yesterday. Toncoin (TON), the native token of The Open Network, is down just 0.4% over the past day.

This leaves the stablecoins USDC (USDC) and Tether (USDT), both of which are stable as they maintain their 1:1 ratio with the US dollar.

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Markets

XRP Market Activity Drops During Ripple-SEC Talks: Price Steady

Published

9 months ago

1 August, 2024

Financial Block Staff

Ripple (XRP) Market Witnesses Calm During SEC-Ripple Meeting

The Securities and Exchange Commission (SEC) will hold another closed-door meeting with Ripple on Thursday, as the market hopes for a possible resolution to the legal battle between the two entities.

However, the cryptocurrency market remains relatively bearish, with the price and trading volume of XRP down in the last 24 hours.

Ripple holders take no risk

At press time, XRP is trading at $0.60. The altcoin’s price has dropped 6% over the past 24 hours. During that time, trading volume was $27 million, down 27%.

The SEC met before with the digital payment company on July 25. While the outcome of that meeting remains unknown, the Sunshine Act Notice for Thursday’s meeting includes one additional topic of discussion from the July 25 closed meeting: the instituting and resolving injunctive relief. That has market participants speculating whether a settlement is imminent.

In an exclusive interview with BeinCrypto, Ryan Lee, Lead Analyst at Bitget Research, noted that:

“This meeting will discuss possible resolution options for the Ripple Lawsuit. The founder of Ripple Labs said that a legal settlement could be announced soon. If an official settlement plan is released, it could positively impact XRP’s price movement.”

However, an assessment of XRP’s price movements on a 4-hour chart shows a spike in bearish bias as the market awaits the outcome of this crucial meeting. Its Moving Average Convergence/Divergence (MACD) indicator readings show that its MACD line (blue) has crossed below its signal line (orange).

XRP 4 Hours Analysis. Source: Trading View

Traders use this indicator to gauge price trends, momentum, and potential buying and selling opportunities in the market. When an asset’s MACD is set this way, it is a bearish signal that suggests selling activity is outweighing buying momentum.

Additionally, the altcoin relative strength index (RSI), at 46.08, is currently below its neutral 50 line and in a downtrend. This indicator measures overbought and oversold market conditions for an asset.

To know more: How to Buy XRP and Everything You Need to Know

xrp rsi XRP 4 Hours Analysis. Source: Trading View

At 43.83 at the time of writing, XRP’s RSI suggests a growing preference among the market participants for tok in distribution.

XRP Price Prediction: Derivatives Traders Exit Market

The XRP derivatives market has also seen a decline in trading activity over the past 24 hours. According to Coinglass, derivatives trading volume has plummeted 18% and open interest has dropped 10% during that period.

Open interest refers to the total number of outstanding derivative contracts, such as options or futurethat have not yet been resolved. When it drops, traders close their positions without opening new ones. This is a bearish signal that reflects a lack of confidence in any potential positive price movement.

According to Lee, the outcome of the meeting with the SEC “would have a significant impact on the price movement of the token.” If the outcome is favorable, the price of the token could rise towards $0.75 in August.

To know more: Ripple (XRP) Price Prediction 2024/2025/2030

XRP Price Prediction XRP 4 Hours Analysis. Source: Trading View

On the other hand, if no favorable resolutions are reached, the price could plummet to $0.50.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto strives to provide accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult a professional before making any financial decisions. Please note that our Terms and conditions, Privacy PolicyAND Disclaimers They have been updated.

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Markets

Bitcoin’s Dominance Hits Three-Year High, But Analysts Say Altcoins Are Ready to Rebound

Published

9 months ago

1 August, 2024

Financial Block Staff

Bitcoin's Dominance Hits Three-Year High, But Analysts Say Altcoins Are Ready to Rebound

Bitcoin is now the dominant force in the cryptocurrency market, surpassing 53% of the total cryptocurrency market, a stronger share than it has been in the past three years.

Bitcoin’s market cap now stands at $1.27 trillion, second according to CoinGecko data. In contrast, the total cryptocurrency market cap is $2.43 trillion, with Ethereum occupying 15.9% of the market, worth $389 billion.

Bitcoin’s rise to dominance this year is unusual, as altcoins typically do better than Bitcoin in a bull market. While meme coins made a strong comeback during Bitcoin’s rally to all-time highs earlier this year, the so-called “wealth effect” It has not been appreciated as much by mid-range coins, such as Ethereum and Cardano.

“ETF flows fundamentally alter market dynamics,” he wrote Meltem Demirors, former chief strategy officer at CoinShares, tweeted Wednesday: “BTC gains no longer translate to alts and the longer tail of crypto.”

Bitcoin’s takeover has continued even as the market cap of Tether (USDT) continues to grow, the world’s largest stablecoin and the third-largest cryptocurrency after BTC and ETH. Stablecoins are backed by fiat currencies and are excluded from some measures of Bitcoin dominance due to fundamentally different value models.

The surge continued to pace even after the launch of Ethereum spot ETFs last week, which ironically culminated in a news sell-off event, and net outflows from new investment products since they were launched. This went against the predictions of K33 Search so far, which predicted that ETFs would catalyze ETH’s growth over the next five months.

Despite the poorer performance of the alts, there is reason to believe that they are ready to bounce back very soon.

CryptoQuant CEO Ki Young Ju said Tuesday that whales are “preparing for the next altcoin rally,” as limit buy orders for assets other than BTC and ETH are on the rise.

The executive shared a chart showing how the “cumulative difference between purchase volume and sales volume” has increased in recent months.

“The indicator measures the difference between buy and sell orders over a year,” CryptoQuant told Decrypt. A buy/sell order is a pre-set request to buy or sell a cryptocurrency if it hits a certain price level, which creates resistance and support levels.

“If the trend is up, it means that more people are placing buy orders, showing strong interest in buying,” CryptoQuant said.

By Ryan-Ozawa.

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Markets

XRP and SOL Retrace as BTC Price Drops to 2-Week Lows (Market Watch)

Published

9 months ago

1 August, 2024

Financial Block Staff

Bitcoin Returns Toward $60K, XRP Defy Negative Sentiment (Market Watch)

After Monday’s crash, in which BTC fell by several thousand dollars, the scenario has repeated itself once again in the last 12 hours, with the asset falling to a 2-week low of $63,300.

Alt coins followed suit, with most of the market in the red today. SOL and XRP lead the way from the higher cap alts.

BTC Drops To $63.3K

After a violent Thursday last week, when BTC crashed to $63,400, the asset went on the offensive over the weekend and surged above $69,000 on Saturday, as the community prepared for Donald Trump’s appearance at the 2024 Bitcoin Conference in Nashville.

His speech was followed by more volatility before the cryptocurrency settled around $67,500 on Sunday. Monday started off rather optimistically for the bulls as bitcoin hit a 7-week high of $70,000.

However, he failed to maintain his run and conquer that level decisively. On the contrary, he was rejected bad and dropped to $66,400 by the end of Monday. Tuesday and Wednesday were less eventful as BTC remained still around $66,500.

The last 12 hours or so have brought another crash. Bears have pushed the leading digital asset down hard, which has fallen to a 2-week low of $63,300 (on Bitstamp), leaving over $200 million in liquidations.

Despite the current rebound to $64,500, BTC’s market cap has fallen to $1.270 trillion, but its dominance over alts is recovering and has reached 52.6%.

Bitcoin/Price/Chart 01.08.2024. Source: TradingView

The Alts are back in red

Ripple’s native token has been at the forefront of the market challenge in recent days as pumped up to a multi-month high of over $0.66. However, its run was also interrupted and XPR fell by more than 6% in the last day to $0.6.

The other big loser among the larger-cap alternatives is SOL, which has lost 8% of its value and is now struggling to get below $170.

The rest of this altcoin cohort is also in the red, with ETH, DOGE, BNB, AVAX, ADA, SHIB, and LINK all seeing drops between 2 and 5%.

The total cryptocurrency market cap lost another $70 billion overnight, falling below $2.4 trillion today on CG.

Cryptocurrency Market Overview. Source: QuantifyCrypto SPECIAL OFFER (sponsored)
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