The mythical Nibelungen were a tribe living in the Rhine region at the western border of modern Germany. The mythical Nibelungen treasure is considered the classical German „national“ treasure. From the historical viewpoint this is incorrect since the underlying action took place in the 5. century while Germany as a nation was not founded earlier than 1871. Apart from these minor details we can say that the fact base of this treasure tale is virtually non-existent.
In the 5. century the Roman empire was collapsing and Europe was shaken by very large movements of peoples. Being under the pressure from the Huns from the east, the Goths moved into the Roman territory since Rome was too weak to defend his borders anymore. Rome itself was plundered twice in the 5. century, by the Visigoths and, some 50 years later, by the Vandals. It was an age of revolution and chaos.
The Nibelungen story was first recorded around the 12. century by an unknown author. It was an epic designed to entertain local rulers rather than a scientific work of an historian. The part of the epic most interesting to treasure hunters is the episode when the tribe’s treasure is thrown into the river Rhine. The person who did this, according to the legend, wanted to avoid that it falls into wrong hands. When that happened, however, no enemy was present so there was no immediate danger for that to happen.
This is not credible since no one gives away his treasure unless it cannot be avoided that he falls into the enemies hands. In the 5. century there was no technology to get the items back from a river so deep and mighty as the Rhine.
To sum it up, 700 years after an undocumented and incredible incident in chaotic times this episode is mentioned in a medieval epic created for entertaining purposes. We do not even know if we translate the medieval language correctly. The crucial passage says something like “sunken (into a?) hole at/into(?) the Rhine.” Not even that makes sense as a river has no holes. A hole near the Rhine? A village with the name “hole” near the Rhine? A hole at a place named “Rhine” other than the river?
The only historical fact I can give in favour of the story is that tribes of that period indeed did have treasures. These were simply funds for all sorts of tribal expenses like warfare etc.. Containing valuable and artful pieces, at least one such treasure was found in south east Europe in the 19. century by chance.
As with all virtually factless myths hundreds of places have been suggested in the last centuries. Of course, the fewer facts are known the more theories can be fabricated that are in compliance with the known facts. In very few cases the people tried to prove their theory by starting their own excavations but did not find anything. In most cases, however, people avoid the effort of physical verification and are content leading some ivory tower battles with competing theorists.
In my opinion currently the fact base is too thin to justify the effort of a physical exploration. From my point of view the next step is not to dig anywhere but to improve the fact base by research. Maybe dormant in some archive is an undiscovered parchment with a more detailed version of the epic. If really no more facts can be found anywhere, and this is very well possible, the file can be closed from the treasure hunters point of view. If the treasure exist and if it is found some day then most likely by coincidence. The is no base for a targeted approach by a treasure hunter.