The UK’s transition to a Labor-controlled government after 14 years prompts concern about whether the Chancellor of the Exchequer could utilize the country’s Bitcoin holdings to fund the party’s goals.
The transition from the Conservative Party-run government to the Labour is prompting questions on how Prime Minister Keir Starmer will handle the UK’s Bitcoin holdings. Crypto intelligence protocol Arkham data shows the UK reserved nearly 61,245 Bitcoin on Friday, July 19, valued at nearly $4 billion.
Prime Minister Starmer appointed Rachel Reeves as the Chancellor of the Exchequer, who can exercise discretion in allocating Bitcoin funds. The majority of the BTC reserves constitute the seizure from the money laundering scheme involving hospitality employee Jian Wen.
Will UK Government Liquidate BTC Holdings?
While a potential sell-off may have some bureaucratic hurdles, Reeves could consider liquidating the BTC holdings. As such, the UK could replicate the just-concluded dumping by Germany to liquidate 49,858 BTC holdings.
The sale of BTC holdings could constitute part of the Labour government’s plans to further economic stability and growth. Notably, the July 17 policy statement by King Charles III indicated that Labour plans to prioritize affordable housing and enhance the nation’s rail system.
Unlike Rishi Sunak’s support for digital assets, Prime Minister Starmer cuts a silent perspective on crypto within the Labour policy objective. Nonetheless, the Labour government is behind 40 bills introduced on July 17 during the King’s speech. Previously, Tulip Siddig, when serving as the City Minister and Economic Secretary in a shadow capacity, signalled in the lead-up to the July 4 election intention to crack down on the digital assets regulations.
The UK is among governments with the largest stockpiles of Bitcoin, with its reserve boasting over 61,000 BTC, second only to the US. The awareness of the huge reserves prompts questions after the German government liquidated the 49,858 BTC holdings in multiple transactions during the June-July sell-off. Germany realized $2.8 billion, though it has yet to clarify its intentions with the funds.
The decision on When Reevers could sell the UK’s Bitcoin holdings is reliant on the bullish and bearish events arising in the crypto space. Market analysts are betting on the lead-up to the November US elections, becoming a catalyst for the crypto market. Additionally, they consider payouts from Mt.Gox capable of imposing selling pressure that would cause Bitcoin’s price to fall.
Bitcoin Oversold After German Sell-Off
Meanwhile, asset manager ARK Invest briefed on July 18, warning that Bitcoin miners appear to capitulate, an indicator of a bullish reversal. ARK Invest attributes the sale to the multibillion-dollar sell-off by Germany of the BTC seized in 2020 from actors behind the Movie2k streaming platform for pirated content.
Ark Invest weighs on the sell-off that sent Bitcoin prices tumbling from $70,000 in early June to test below the $55,000 level in the July dip. The report considers the short-term holder profits and losses alongside miner outflows, showing Bitcoin is oversold.
ARK Invest considers the investors to have a sustained appetite for Bitcoin exchange-traded funds (ETFs), thus a bullish signal. Notably, the ARK report illustrates that the BTC sharp sell-off hardly triggered the mass exodus from the spot BTC ETFs. In particular, the BTC spot price triumphed over the 30-day change in the BTC ETF flows by 17.3%.
July saw billions of net inflows into the BTC ETFs, which were estimated at $1.35 billion by mid-July, according to CoinShares. BlackRock’s iShares Bitcoin Trust (IBIT) leads with $107 million daily inflows on July 18 to continue the nine days of consecutive inflows, as per crypto data protocol Apollo co-founder – Thomas Fahrer.
ARK warns that Bitcoin faces the greatest risk of sustaining strong performance as the global economic data. The asset management firm indicates a steady fall in corporate profits as pricing power declines to signal economic weakness.
ARK Invest identifies with the industry analysts’ view that Bitcoin prices could encounter potential headwinds as the defunct crypto exchange Mt. Gox repays the $9 billion worth of BTC to creditors. Nevertheless, the analysts consider that, unlike Germany’s sudden sell-off, the Mt. Gox creditors may hold on to Bitcoin. Doing so would soften the potential impact on the larger crypto market.
The post Will the UK Labour-led Government Follow Germany’s Sell-Off to Liquidate 61,245 BTC first appeared on CryptocyNews.com.
from CryptocyNews.com https://www.cryptocynews.com/will-the-uk-labour-led-government-follow-germanys-sell-off-to-liquidate-61245-btc/
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