Key Takeaways
- Germany sold 50,000 bitcoins in July 2024 for $3.13 billion, missing out on billions as the price doubled within a year.
- Other countries, including El Salvador and Bhutan, accumulated bitcoin while Germany and the US liquidated, causing a drop in state-owned reserves.
- Germany’s sale is now seen as a cautionary example for governments considering whether to hold or sell seized bitcoin holdings.
In July 2024, the German government sold off 50,000 bitcoins it had seized in an anti-piracy operation, netting $3.13 billion from the sale.
Since then, the price of bitcoin has doubled, meaning that the same holdings would be valued at over $6.64 billion today.
Other countries
This decision stands in sharp contrast to countries such as El Salvador and Bhutan, which have chosen to accumulate bitcoin as a strategic reserve rather than liquidate.
The German government’s remaining bitcoin wallet now holds just 0.0069 BTC, mostly comprised of small donations from the public.
Observers have noted that Germany’s approach is especially surprising given the country’s relatively open stance toward bitcoin regulation, having issued more MiCA licenses than any other EU member. The episode has sparked debate on the wisdom of governments rapidly divesting seized digital assets rather than holding them.
Analysts chime in
A bitcoin analyst commented on social media:
“Among all the bad decisions being made for the country at the moment, this turns out to be the worst.”
In 2024, several nations, including the United States and Ukraine, also opted to reduce or liquidate their bitcoin holdings, leading to a 12% drop in state-owned reserves.
By contrast, China and the UK made no significant moves with their custodial assets.
With bitcoin’s long-term price trend frequently highlighted by advocates, Germany’s decision is now cited as a cautionary tale for governments managing seized digital assets. Holding onto bitcoin reserves, rather than selling at the first opportunity, may offer significant upside for state treasuries.
