Justin Sun, the founder of Tron and a prominent figure in the crypto industry, has proposed buying the German government’s Bitcoin holdings in an effort to reduce the impact on the market. This comes after weeks of consistent Bitcoin sales by the state, which have contributed to a 19% decline in Bitcoin’s price over the past month.
Sun’s offer, communicated through X, suggests an off-market purchase of all the German government’s Bitcoin. His intention is to minimize the market’s reaction to the government’s offloading of its cryptocurrency holdings.
This move is in line with Sun’s previous efforts to stabilize the crypto market during periods of price decline. He recently protected Curve founder Michael Egorov’s CRV loan from liquidation and considered purchasing FTX’s digital assets to prevent market disruption caused by bankruptcy proceedings.
The German government has been selling a substantial amount of Bitcoin, approximately 50,000 BTC, which it confiscated from the operators of the film piracy website Movie2k.to in January. Blockchain analysts at Arkham first noticed the government’s movement of BTC between wallets on June 19, with a significant portion likely being deposited into exchanges like Coinbase, Kraken, and BitStamp. On Thursday, the government resumed selling to these exchanges, transferring an additional 1300 BTC ($76 million). It also sent another 1700 BTC ($99 million) to an unidentified address, possibly an institutional or over-the-counter (OTC) service.
According to Arkham’s data, the German government still possesses 40,359 BTC worth $2.31 billion at the time of writing.
Apart from Germany, investors are also concerned about the impending distribution of 141,000 BTC to creditors of the defunct Bitcoin exchange Mt. Gox. Although the exchange has announced that distributions will begin this month, no concrete evidence of the distributions has surfaced yet.
Furthermore, on-chain analysis reveals that Bitcoin miners have been selling their BTC at a rapid pace in June due to reduced revenue after the halving. This has led to a 7.7% decline in the network’s total hashrate since its peak in April. CryptoQuant suggests that this significant reduction in hashrate could indicate a bottoming out of Bitcoin’s price.
It remains to be seen whether Justin Sun’s proposal to purchase the German government’s Bitcoin will be accepted and how it will impact the cryptocurrency market. Investors are closely monitoring these developments amid ongoing market uncertainties.
