US Government’s Plan to Sell-Off $1.8 Billion Worth of Bitcoin Triggers Bearish Signals
The US government is preparing to sell a significant portion of its Bitcoin holdings, surpassing even MicroStrategy, a major corporate player in the crypto market. The planned sale involves the remaining 41,491 Bitcoins seized from the notorious Silk Road, which are currently valued at $1.8 billion.
The recent surge in Bitcoin prices has proven to be highly profitable for the US government, as its Bitcoin holdings have skyrocketed to an astonishing $8.3 billion. This substantial increase from $5 billion in just three months is a result of actions taken between November 2020 and 2022.
During this period, authorities seized and revealed a substantial 207,189 Bitcoins linked to various cases, including the Silk Road dark web market and the Bitfinex crypto exchange breach.
On the other hand, MicroStrategy, a major player in the corporate crypto space, currently holds 189,150 Bitcoins that were acquired for approximately $5.9 billion. The US government’s holdings now exceed those of this significant corporate player, highlighting the government’s unintentional foray into the crypto market.
Interestingly, the US government may now hold more Bitcoin than El Salvador, Ukraine, Bhutan, Venezuela, and Finland combined. China could rival the US if it decides not to sell off its cryptocurrency holdings early, as it seized 195,000 BTC ($8.4 billion) in 2020.
The US government’s strategy for selling Bitcoin is now unfolding. With less than 5% of Silk Road Bitcoins sold so far, the Department of Justice plans to sell the remaining 41,491 Bitcoins in four batches over the next two months. This comes after a previous sale of 8,200 Bitcoins to Coinbase in July of the previous year, which was valued at $252 million at the time and is now worth $350 million.
If these transactions are confirmed, the US government could gain a significant financial windfall of $640 million from the seizure and sale of Bitcoin over the past decade. It’s worth noting that if all seized Bitcoins had been retained, the government’s holdings would have nearly doubled to around 400,000 Bitcoins, valued at $17.4 billion today.
As the US government emerges as a potential global leader in government-held Bitcoins, surpassing the combined holdings of several countries, including China, the crypto market is preparing for the impact. The market is closely watching for the potential sale of more Silk Road Bitcoins and the uncertainties surrounding the sale of Bitcoins seized from Bitfinex hackers.