In the early hours of today, the US government transferred approximately 30,175 bitcoins, with 2,000 bitcoins (worth about $130 million) being transferred to Coinbase. This is comparable to the amount of bitcoins seized from the Silk Road case that the US government announced it would sell at the end of January, sparking speculation about the sale.
Background:
Will the US government’s auction of $1 billion worth of bitcoins affect the market? How many confiscated BTC are there in total?
The US government has confiscated a large amount of bitcoins from cases such as the Bitfinex hack and the Silk Road, making it the sixth-largest bitcoin whale in the world, holding over 210,000 bitcoins currently worth about $13.97 billion. How the US government handles these seized bitcoins has always been a topic of market concern, as any sale could affect the price.
The US government is suspected of selling $130 million worth of BTC
In the early hours of today, the US government transferred 30,175 bitcoins (currently worth about $1.96 billion), with 2,000 bitcoins (currently worth about $130 million) being transferred to Coinbase. The records indicate that the US government may have sold a portion of the bitcoins.
According to specific transfer records from the cryptocurrency intelligence platform Arkham, the Silk Road BTC addresses seized by the US Department of Justice first sent 0.001 BTC to the Coinbase Prime address (3KrZ) and transferred about 30,000 bitcoins to a new address (bc1qk). This may have been a small test transaction before the US government made a large transfer to Coinbase.
Transfer of 0.001 BTC ($65.09) to Coinbase
After receiving the BTC, the new address (bc1qk) then transferred 1,999.999 bitcoins (worth about $130 million) to the same Coinbase Prime address (3KrZ). According to experts at the Dynamic Zone, based on the exchange’s operational logic, this new address (bc1qk) may be a payment address specifically issued by the exchange to customers, indicating that the US government may have deposited funds into the exchange in preparation for the sale.
The remaining 29,800 bitcoins (worth about $1.96 billion) were then transferred to a new address (bc1qj). Currently, this address has not made any further transfers, but it is not ruled out that it is just the exchange’s internal consolidation of large amounts of bitcoins held by customers. It is necessary to continue monitoring whether the BTC will be moved to the exchange’s centralized wallet.
Transfer of 1,999.999 BTC ($130 million) to Coinbase
Announcement of selling 2,858 BTC at the end of January
The amount of bitcoins transferred to Coinbase this time is equivalent to the 2,858 bitcoins confiscated from the Silk Road case that the US government announced it would sell at the end of January, increasing the likelihood of the US government selling bitcoins. However, it is expected that the US government will sell gradually in batches or through over-the-counter (OTC) transactions, rather than selling all at once. Previously, the US Marshals Service stated that they would try to prevent adverse effects on the market.
According to the announcement at the end of January, the US government plans to sell two batches of bitcoins: the first batch of about 2,800 BTC and the second batch of about 58 BTC. These bitcoins were all confiscated and came from:
– Ryan Farace and his father, who were convicted of money laundering through bitcoins. These BTC were initially used for drug trafficking and were later found by the prosecution attempting to transfer over 2,874 bitcoins to a third party to move funds to foreign bank accounts. Ryan Farace was sentenced to 54 months in prison last year for conspiracy to commit money laundering.
– Former FBI special agent Shaun Bridges, who was originally a member of the Silk Road task force but was found to have privately stolen bitcoins during the investigation and was sentenced to six years in prison in 2015.
Both the Farace family and Bridges were ordered to forfeit their bitcoins, and Bridges agreed to transfer the stolen bitcoins to the US FBI.
In recent years, the actions of the US government selling bitcoins include selling 9,861 bitcoins confiscated from the Silk Road case on Coinbase in March last year.
Related reports:
US government to sell $114 million worth of bitcoins, still holding over 210,000 BTC
The US government is the “third-largest BTC whale in the world”: Arkham: The US holds over $6 billion worth of bitcoins on-chain
Will the US government “sell bitcoins at a high point”? Confiscated BTC’s total value soars to $8.5 billion.