Justin Sun Proposes Buying German Government’s Bitcoin OTC to Mitigate Market Impact

Justin Sun Proposes Buying German Government’s Bitcoin OTC to Mitigate Market Impact

Tron founder and crypto billionaire Justin Sun has proposed purchasing Bitcoin directly from the German government to avoid the potential market disruption caused by the sale of its cryptocurrency holdings. Sun’s offer, made via X on Thursday, aims to minimize the adverse effects of these transactions on the broader crypto market.

Justin Sun’s Strategic Offer to Germany

Sun’s proposal follows two weeks of continuous Bitcoin sales by the German government, which analysts believe has contributed to a 19% drop in Bitcoin’s price, currently standing at $56,849. By offering to buy all of Germany’s Bitcoin off-market, Sun hopes to prevent further market volatility.

This move aligns with Sun’s previous efforts to stabilize the crypto market during periods of significant price declines. He previously intervened to protect Curve founder Michael Egorov’s CRV loan from liquidation and considered purchasing FTX’s digital assets to mitigate the impact of its bankruptcy proceedings.

German Government’s Bitcoin Liquidation

The German government has started liquidating a substantial portion of the 50,000 BTC it seized from the operators of the film piracy website Movie2k.to in January. Blockchain analysts at Arkham detected movements of these BTC between wallets on June 19, with many coins likely deposited on exchanges such as Coinbase, Kraken, and BitStamp. Additional transfers resumed on Thursday, with the government moving another 1,300 BTC ($76 million) to exchanges and 1,700 BTC ($99 million) to an unidentified address, possibly an institutional or over-the-counter (OTC) service.

Despite these sales, the German government still holds 40,359 BTC, valued at approximately $2.31 billion.

Broader Market Concerns

In addition to Germany’s BTC sales, the crypto market is facing other potential disruptions. Investors are wary of the impending distribution of 141,000 BTC to creditors of the defunct Bitcoin exchange Mt. Gox, scheduled to begin this month. Although no distributions have been observed yet, the anticipation is causing concern among market participants.

Moreover, Bitcoin miners have been selling their holdings at an accelerated rate due to post-halving revenue reductions, resulting in a 7.7% decrease in the network’s total hashrate since its peak in April. CryptoQuant, in a Wednesday market report, noted that such significant hashrate drawdowns have historically been associated with price bottoming conditions.

Conclusion

Justin Sun’s proposal to purchase the German government’s Bitcoin holdings off-market highlights his proactive approach to mitigating potential market disruptions. By aiming to stabilize the crypto market during periods of increased sell pressure, Sun continues to play a crucial role in supporting the industry’s resilience.

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