The transaction involved 250 BTC being sent to each exchange, while an additional 500 BTC was sent to an undisclosed address.

A leading crypto analytics firm, Arkham Intelligence, identified the addresses linked to the German government behind these transfers. According to their findings, the German government currently holds a total of 38,826 BTC, which were seized as part of criminal cases. At current prices, these holdings are valued at over $2.23 billion.

The majority of the seized BTC came from a piracy sting in January when Bitcoin was trading at around $46,000. In recent days, the German government has been selling off its Bitcoin holdings through various crypto exchanges. This has resulted in a drop in Bitcoin's price, causing tumultuous conditions in the wider crypto market. However, at the time of publication, Bitcoin has managed to recover and is trading flat at around $57,590.

The German government's strategy regarding Bitcoin has come under scrutiny. Joana Cotar, an independent Member of the Bundestag, criticized the government for lacking a clear strategy and not fully understanding the consequences of their sales. On the other hand, controversial Tron founder Justin Sun has publicly expressed his interest in purchasing the remaining Bitcoin holdings of the German government to minimize market impact.

Decrypt analysts predict that the sell-off pressure on Bitcoin is likely to persist in the coming days, as the German government's sales are compounded by the transfer of funds from the bankruptcy estate of Mt. Gox. Mt. Gox users, who suffered losses from a hack over a decade ago, are anxiously waiting for restitution payments of up to $7.7 billion, set to begin in July.

As Germany continues to offload its Bitcoin holdings, the crypto market braces for further fluctuations. The impact of these sales on the market dynamics remains a subject of interest and speculation.