German Government Loses $2.4 Billion by Selling 50,000 Bitcoin at $54K

Key Points:

• The German government sold 50,000 Bitcoin at $54K each, losing $2.4 billion in missed profits.
• After the sale, Bitcoin’s price surged to over $69K, increasing the potential profit from their holdings by billions.
• Critics argue that the government acted too hastily, overlooking Bitcoin’s long-term growth potential.

The German government recently sold off 50,000 Bitcoins at $54,000 apiece, possibly costing the country a minimum of $2.4 billion.

Germany’s $2.4 Billion Loss from Bitcoin Sale

The whole sale was made in 2021 but became all the more controversial as Bitcoin started to soar in the coming years. The German government was looking to sell off its stake at the time, which it had acquired through confiscating money from criminal activity.

But Bitcoin’s price has since gone parabolic, topping $60,000 in late 2021 and rising above $69,000 in 2022—to an even greater opportunity cost. If the government had retained the 50,000 BTC, its current asset valuation would be approximately $5 billion or a gain in unrealized profits of $2.4 billion.

Read more: German Government Bitcoin Sale Helps Recover Nearly $2.9 Billion

Criticism of Germany’s Hasty Decision to Sell Bitcoin

That decision to sell at $54,000 per Bitcoin has been criticized, especially as investors well understood Bitcoin’s volatility and potential for growth. Indeed, many consider that the government acted in a rush without trying to examine the long-term potential of holding Bitcoin as a store of value. The timing of the sale and the subsequent missed profits tend to question the decision-making process behind the government’s holding of cryptocurrencies.

The large price swings in Bitcoin have always been contentious, with some positing that it can offer a hedge to inflation and a store of value. The move by the German government to offload its stash at such a critical juncture has now turned into a case study of the risks of misjudging the market. Many feel that, in hindsight, the government could have come out a lot richer if they had held on to Bitcoin until its value appreciated even more.