US Government Moves $600 Million in Seized Bitcoin to Coinbase Prime
US Government Transfers 10,000 Bitcoin Worth $600 Million to Coinbase Prime; Likely for Custody, Not Immediate Sale.
Key Takeaways:
- The US government transferred 10,000 Bitcoin (worth $600 million) to Coinbase Prime.
- The transfer may be for custody reasons rather than an immediate sale.
- The US holds approximately 203,000 BTC valued at $12 billion.
The US government has made a significant move in handling Bitcoin seized from the infamous Silk Road dark web marketplace.
On Wednesday, blockchain data from Arkham Intelligence revealed that 10,000 BTC, valued at approximately $600 million, was transferred to Coinbase Prime, the institutional platform of the Coinbase cryptocurrency exchange.
US Government's Bitcoin Custody Strategy Evolves
According to Arkham Intelligence, the transfer originated from a wallet that had received the funds two weeks earlier from an account tagged as “U.S. Government: Silk Road DOJ Confiscated Funds.”
While deposits to exchanges often signal an intention to sell, this transfer may be part of a broader custody strategy.
Last month, the U.S. Marshals Service, a Department of Justice (DOJ) division, announced a partnership with Coinbase Prime to “safeguard and trade” large-cap digital assets.
This move aligns with the government's evolving approach to managing seized cryptocurrency assets.
The last confirmed sale of Silk Road assets by the government occurred in March 2023, when 9,861 BTC were sold for $216 million.
At that time, the government outlined plans to sell the remaining assets in four tranches throughout the year. Still, no follow-up communications about additional sales have been made public since then.
The US government currently holds approximately 203,000 BTC, valued at roughly $12 billion.
This substantial holding makes the US government the largest geopolitical holder of Bitcoin.
Despite the significant transfer, the immediate market reaction was muted as Bitcoin's price had already declined from $61,000 to $59,000 earlier in the day before the transaction took place.
Trump’s Bitcoin Stockpile Vow and Market Concerns Over Potential Dumps
Presidential candidate Donald Trump has repeatedly addressed the “HODL” theme in his 2024 campaign.
Trump has promised not to sell any of the US government's Bitcoin holdings if elected and has proposed establishing a “strategic Bitcoin stockpile.”
The erstwhile US President told audiences at the Bitcoin 2024 conference in Nashville, Tennessee:
“We have an opportunity to lead in the digital asset space. If elected, I will establish a strategic Bitcoin stockpile to secure America's financial future.”
Trump has also hinted at potentially using Bitcoin to address the government's $35 trillion national debt, though specific details of such a plan remain unclear.
So far, the cryptocurrency market has shown sensitivity to large-scale selloffs by major holders. In July, news of the German government selling its Bitcoin holdings caused market turbulence.
Germany ultimately sold 50,000 Bitcoin, valued at approximately $2.9 billion at the time, and now holds just 0.007 BTC, according to Arkham Intelligence data.
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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