MicroStrategy is undoubtedly the biggest corporate player with the largest crypto holdings currently in the market. However, the U.S. govt holds an even bigger stash of Bitcoins seized from notorious routes. Last month itself, the U.S. govt seized a total of 70,000 Bitcoins from the Silk Road.
US Govt. Bitcoin Holdings
The recent surge in Bitcoin’s price has proven to be a boon for the United States government, which now finds itself holding a significant amount of the cryptocurrency. The latest figures indicate that the Federal authorities’ Bitcoin holdings have surged to at least $8.3 billion, marking a substantial increase from the $5 billion reported less than three months ago.
This uptick in Bitcoin holdings is attributed to actions taken by authorities between November 2020 and 2022. During this period, three separate actions resulted in the disclosure and seizure of 207,189 bitcoins (BTC). These bitcoins were linked to various cases, including the notorious dark web market Silk Road, its hacker Jimmy Zhong, and the hackers involved in the Bitfinex crypto exchange breach. On the contrary, MicroStrategy holds 189,150 BTC, acquired for around $5.9 billion, and is working on measures to add more.
Notably, less than 5% of the seized bitcoins have been sold to date. In February of the previous year, officials liquidated 9,861 BTC, previously owned by Silk Road, on the Coinbase platform. The sale generated $215 million at an average price of $21,800 per bitcoin, roughly half of the current market price.
US attorneys had announced their intention to sell the remaining bitcoins from Silk Road, totaling 41,491 BTC and valued at $1 billion then and $1.8 billion in today’s market. The plan was to conduct these sales in four batches over the following calendar year, with two months remaining until the expiry of this period, reported Blockworks. Thus, the market awaits further developments regarding the government’s Bitcoin holdings and potential sales.
Bitcoin Sales By The US Govt.
The United States Department of Justice has potentially completed one batch of Bitcoin sales, sending 8,200 BTC (valued at $252 million then and $350 million now) to Coinbase in July of the previous year. However, the confirmation of actual trades resulting from this transaction remains unverified.
If these transactions are recognized as sales, the US government would have generated $640 million by seizing and selling Bitcoin over the past decade. Notably, the price of BTC has multiplied 70 times during this period. Had the US authorities chosen to retain all seized BTCs rather than selling them, their holdings would now stand at around 400,000 BTC, equivalent to $17.4 billion, nearly doubling the current cache.
The market anticipates the possibility of more Silk Road Bitcoin being liquidated by the US government in the coming months. However, there is currently no official timeline for the sale of Bitcoin seized from Bitfinex hackers Ilya “Dutch” Lichtenstein and Heather “Razzlekhan” Morgan. Market participants will closely monitor developments regarding these potential sales amid the dynamic cryptocurrency landscape.
The US potentially holds the world’s largest government bitcoin stash, surpassing El Salvador, Ukraine, Bhutan, Venezuela, and Finland combined. China, seizing 195,000 BTC ($8.4 billion) in 2020, could rival the US if it hasn’t sold its holdings early.
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