Bitcoin News Today: Germany’s $5B Bitcoin Oversight Sparks Debate Over Crypto Strategy

German authorities reportedly missed seizing $5 billion in Bitcoin tied to the Movie2K piracy case, according to recent analysis by crypto intelligence firm Arkham. The firm identified 45,060 Bitcoin (BTC) held in over 100 wallets connected to the now-defunct Movie2K site, with no movement recorded since 2019. At current prices, these coins are valued at approximately $4.99 billion, slightly below the $5.6 billion they would have been worth at Bitcoin’s peak in mid-August 2025.

In January 2024, German police seized 49,858 BTC from the operators of Movie2K, later selling the coins in June and July of the same year at an average price of $57,900. This generated roughly $2.8 billion in proceeds for the state. However, this sale occurred just months before Bitcoin’s price surged, reaching over $100,000 in December 2024—nearly doubling in value. As a result, the missed opportunity has drawn criticism from analysts and lawmakers who argue that Germany could have captured significantly greater value had it delayed the sale.

Prosecutors justified the timing of the initial sale by citing legal mandates that require volatile assets such as cryptocurrencies to be sold quickly to mitigate a potential 10% or greater loss in value. However, Arkham’s findings suggest that additional Bitcoin tied to the same case remains under the control of the original operators. German authorities must now prove in court that these newly identified holdings are of illicit origin to justify further seizures.

The situation highlights the challenges of crypto enforcement, where technical hurdles such as dormant keys and complex custody chains can complicate the recovery process. Authorities must also identify and trace the ownership of these over 100 wallets before any seizure can proceed. Some analysts have suggested that holding confiscated Bitcoin as a sovereign reserve could have yielded greater returns for the state, while others caution that the asset’s volatility poses significant financial risks.

Germany’s handling of the Movie2K case has also sparked broader discussions about how different countries manage confiscated crypto assets. For example, El Salvador recently moved $678 million in Bitcoin to 14 wallets to protect against potential quantum threats. Meanwhile, within Germany, there is growing debate among lawmakers and financial experts about whether the government should adopt a more strategic approach to managing digital assets, balancing legal obligations with long-term financial gains.

Source: [1] Germany failed to seize $5B Bitcoin tied to piracy site Movie2K - Arkham (https://cointelegraph.com/news/germany-failed-seize-5b-bitcoin-piracy-site-movie2k-arkham) [2] $5 Billion Bitcoin Treasure Tied To Piracy Website Found... (https://www.mitrade.com/insights/news/live-news/article-3-1102231-20250907) [3] Europe Takes the Lead in Crypto as U.S. Stalls on Regulation (https://cryptodnes.bg/en/europe-takes-the-lead-in-crypto-as-u-s-stalls-on-regulation/)