US Government Transfers $2 Billion Worth of Bitcoin Seized From Silk Road, Market Price Drops

On July 29, 2024, the US government transferred nearly 28,000 BTC, worth approximately $2 billion, to unidentified recipients.

Bitcoin price dropped again and is now trading at 65,000 dollars. This decline comes after a massive transfer of 2 billion dollars in BTC carried out by the US government to unknown recipients.

According to Arkham Intelligence, on July 29, the government transferred nearly 28,000 BTC to unidentified recipients. This transaction was later linked to funds seized by the US Department of Justice in 2020 from the defunct dark web marketplace Silk Road.

After the initial transfer, the government redistributed the bitcoins by sending about 19,800 BTC to one address and 10,000 BTC to another. This action, as interpreted by Arkham Intelligence, suggests an institutional deposit, indicating strategic management of the seized assets.

The massive bitcoin transfer had immediate market repercussions. Following the announcement of this transfer, the price of bitcoin dropped, falling below 66,000 dollars. At the time of writing, the crypto asset is trading just above this threshold.

Reactions and speculations to the US government move

The crypto community is abuzz with speculation about the motivations behind this massive transfer. David Bailey, CEO of Bitcoin Magazine, suggested that this move could be politically motivated to counter the policies of former President Donald Trump.

According to Bailey, this action could be seen as an attempt to hinder Trump’s pro-crypto policies, especially his promise not to sell the government’s bitcoin holdings. Other crypto figures, like Mike Novogratz, criticized the timing of the transfer, calling it “ill-advised”.

Some speculate that this action might be related to an agreement with Coinbase for the custody of government assets. This speculation is reinforced by the fact that the government had previously transferred nearly 2,000 BTC to a Coinbase Prime hot wallet in April.

The implications of these actions are vast. Economically, such massive transactions can influence investor confidence and affect market prices. Politically, they raise questions about the use of digital assets as economic and political instruments, reflecting broader ideological battles within the American political sector.

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