The United States government has recently moved 10,000 Bitcoin (BTC) that were seized from Silk Road, the infamous dark web marketplace. This is part of a broader trend where the government has transferred large amounts of Bitcoin to different wallets or exchanges over the years.
US Government Sends 10,000 BTC to Coinbase Prime
On August 14, Arkham Intelligence, a blockchain analytics firm, reported via a post on X (formerly Twitter) that the US government had moved 10,000 BTC—worth approximately $593.5 million at the time—from assets it had confiscated during the Silk Road bust. This transfer has drawn significant attention from the crypto community, leading to speculation about its purpose and potential effects on the already shaky cryptocurrency market.
In November 2021, the government had seized over 50,000 BTC from Silk Road, which was valued at roughly $3.36 billion at the time. According to Arkham’s analysis, the wallet address starting with bc1ql received 10,000 BTC from a government-linked wallet. This Bitcoin was then transferred to a wallet associated with Coinbase Prime, marked with the address 33J.
Speculation Over a Potential Sale
Given the sheer size of this transfer, many within the crypto community are wondering if the government is preparing to sell the Bitcoin. A sale of this magnitude could have a significant impact on the market, which is still reeling from recent declines in Bitcoin, Ethereum, and other major cryptocurrencies.
However, it’s important to note that a deposit to an exchange doesn’t necessarily mean the government plans to sell. Some analysts suggest that the move could be for custody reasons. This theory is supported by the fact that on July 1, the US Marshals Service, part of the Department of Justice (DOJ), selected Coinbase Prime to provide custody and advanced trading services for large-scale digital assets.
Bitcoin Price Drops Below $59,000
The news of the government’s transfer caused Bitcoin’s price to drop significantly. According to CoinMarketCap, Bitcoin is currently trading below the $59,000 mark, after a series of sharp price swings in recent weeks. The cryptocurrency has been struggling to stay above $60,000 and recently experienced a drop of more than 20%, driven by large-scale sell-offs and liquidations, including actions by both crypto whales and the German government.
With rising concerns that the US government might sell off its Bitcoin holdings, the cryptocurrency market could face increased volatility. As of now, Bitcoin is trading at $58,321, reflecting a 4.11% decrease in the last 24 hours.
