U.S. Government Shifts $4M in Confiscated Bitcoin to Coinbase
U.S. Government Transfers $4 Million in Bitcoin from Seized Assets to Coinbase; Mt. Gox Repays Creditors with $2.82 Billion BTC Movement.
Key Takeaways:
- The U.S. government moved 58.742 BTC ($4 million) to Coinbase on Monday.
- Funds originated from seized assets of convicted dark web drug dealer Ryan Farace.
- The transfer represents less than 1% of Bitcoin's 24-hour trading volume.
- Mt. Gox moved over 42,587 BTC ($2.82 billion) as part of creditor repayments.
Introduction
The U.S. government has transferred 58.742 BTC ($4 million) to Coinbase, which may indicate plans to liquidate seized cryptocurrency assets. This transfer follows a similar transaction last month, in which $240 million in seized BTC was transferred to the same exchange. The frequency of these transfers suggests a pattern in the government's management of seized crypto holdings.
U.S. Government's Bitcoin Transfer Unveiled
According to Arkham Intelligence, the transfer, which happened on Monday, originated from an address labeled “U.S. Government: Ryan Farace Seized Funds.”
In 2018, Ryan Farace was convicted of selling Xanax pills on the dark web, leading to the seizure of his assets, including 58.742 BTC.
The case took a new turn when his father, Joseph Farace, was also convicted of laundering and trafficking Bitcoin proceeds. As a result, the Department of Justice recovered a total of 2,933 BTC from the duo and announced plans to liquidate the assets in January.
This recent transfer represents only a fraction of the U.S. government's substantial cryptocurrency holdings. The U.S. government holds approximately $15 billion worth of cryptocurrencies in storage, with nearly $14.6 billion in Bitcoin.
Meanwhile, a wallet associated with Mt. Gox has been executing a series of Bitcoin transfers.
The most significant occurred early Tuesday, when approximately 42,587 BTC, valued at $2.82 billion, was moved to a new address.
The Mt. Gox transfer also included additional movements of 5,110 BTC transferred to a cold storage address and 2,238 BTC, worth around $150 million, moved to Bitstamp exchange. These transfers are part of Mt. Gox's ongoing effort to repay creditors following its 2014 bankruptcy.
Market Impact and Comparison to Recent Large Sales
Despite the substantial amounts involved in Bitcoin transfers by both the U.S. government and Mt. Gox, the immediate impact on the Bitcoin market appears to be limited.
According to data from Coingecko, the transfer of 58.742 BTC from the U.S. government represents less than 1% of Bitcoin's 24-hour trading volume, which exceeds $35 billion.
Similarly, the Mt. Gox repayments, despite their larger scale, have been anticipated by the market for some time, potentially mitigating its impact.
Recent larger sales, like Germany's liquidation of 49,858 BTC between June 19 and July 12, had a more noticeable impact, driving Bitcoin's price down to $53,500 at one point.
At press time, Bitcoin is trading at $66,761, showing a modest 0.66% decline over 24 hours.
This resilience suggests that the market has largely absorbed the news of these transfers.
Jimmy Aki
Drawing from his background in economics, Jimmy has monitored blockchain development for years, firmly believing in its power to democratise finance. Beyond offering commentary on the latest crypto developments, he also spends his time analysing open-source codes of promising projects on GitHub. Jimmy holds Bitcoin and Ethereum.
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