Bitcoin advocate Joana Cotar has called on the German government to stop its rapid Bitcoin sales and consider using the cryptocurrency as a strategic reserve currency. In a letter to government officials on July 4, Cotar argued that Bitcoin could diversify Germany’s treasury assets, hedge against inflation and currency devaluation, and foster innovation.
The Case Against Rapid Bitcoin Sales
Since June 19, the German government has sold 7,583 Bitcoin, valued at $434.9 million, according to Arkham, a cryptocurrency intelligence platform. The latest sale on July 4 involved transferring $172 million worth of Bitcoin to exchanges like Coinbase, Kraken, and Bitstamp. Despite these sales, Germany still holds 42,274 Bitcoin, worth approximately $2.4 billion.
Cotar criticized these sales as “counterproductive” and emphasized that halting the mass sell-off could strengthen Germany’s economic independence and resilience. She proposed a comprehensive Bitcoin strategy that includes keeping Bitcoin in the state treasury, issuing Bitcoin bonds, and creating a supportive regulatory environment. Such measures, Cotar suggested, could attract top talent and promote Bitcoin-based innovation.
Invitation to “Bitcoin Strategies for Nation States”
Cotar invited four German politicians to the “Bitcoin Strategies for Nation States” event in October, where they will discuss the potential benefits of using Bitcoin as a strategic reserve currency. She believes that a well-thought-out Bitcoin strategy could help Germany hedge against economic uncertainties and promote technological advancement.
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Market Reactions and Future Plans
The German government has not confirmed whether it will continue selling its Bitcoin holdings. However, Tron founder Justin Sun has offered to buy Germany’s $2.3 billion worth of Bitcoin to minimize market impact. This offer comes as Bitcoin faces a price slump, with the cryptocurrency currently trading at $57,810, down 6% over the last week and 18% over the last month.
Germany’s Bitcoin sell-off and the Mt. Gox reimbursement plan, which involves distributing $9 billion worth of Bitcoin to creditors, have been linked to the recent decline in Bitcoin prices. Cotar argues that halting rapid Bitcoin sales and using it as a strategic reserve could mitigate these impacts and offer long-term benefits to Germany’s economy.
Joana Cotar’s appeal to the German government underscores the potential of Bitcoin as a strategic asset. By adopting a comprehensive Bitcoin strategy, Germany could enhance its economic resilience, hedge against financial risks, and lead in innovation. The upcoming “Bitcoin Strategies for Nation States” event in October may provide a platform for further discussion and potential policy shifts.
