The German government’s criminal investigation unit Bundeskriminalamt, or BKA, sent shockwaves through the crypto market when it started unloading its stash of 50,000 bitcoin, worth around $2.8 billion, last Wednesday.

Wallets tied to the BKA moved $600 million worth of bitcoin on June 19, sending at least $195 million to crypto exchanges. Since then,  BKA has moved nearly all of its $2.8 billion stash to new wallets and crypto exchanges, resulting in the price of bitcoin dropping from $65,000 to around $57,000 at the time of writing.

As of July 8,  amid the German government’s bitcoin transfers to exchanges, bitcoin reserves on exchanges reached multi-year lows.  Exchanges monitored by CryptoQuant held $156.6 billion worth of bitcoin reserves — the lowest number of tokens since November 2018.

While the BKA’s activity sent the price of bitcoin lower, it is worth noting that bitcoin recovered some of its losses, gaining 5% over the last seven days. Selling pressure from the German government might also be close to the end, as data from Arkham shows that the BKA wallet is down to its last 6,394 BTC, worth $366 million at current prices.

Still, the wallet’s activity hasn’t been all that straightforward, sometimes the transfers to unlabelled addresses and exchanges have ended up back in the BKA’s main wallet address. This suggests that the entity is likely testing liquidity across exchanges before executing sell orders.

With the known threat of sell pressure from the BKA looming each day, it is no surprise that traders have turned cautious, evidenced by the market sentiment indicator the “Fear and Greed” index which dropped to the “extreme fear” region on Thursday.

According to one crypto market analyst, a high fear index could signal an optimal entry point for bitcoin. 

“One of the best metrics for identifying optimal entry points in a bull market is when short-term Bitcoin holders sell at a loss and the fear index is ridiculously high (which has been happening in recent weeks),” said CryptoQuant analyst elcryptotavo.

“In contrast, previous market peaks have been signaled by long-term holders taking significant profits over numerous months, which hasn’t happened yet.”

July 12, 06:24 a.m. ET: This story has been updated to clarify details regarding bitcoin reserves on exchanges.