United States finance lawyer Scott Johnsson has said the US Marshals Service (USMS) is almost certainly in the process of selling Bitcoin seized from the infamous Silk Road marketplace.
Johnsson’s assertions are grounded in a service agreement signed between the USMS and Coinbase in June. According to Johnsson, this agreement indicates that once Bitcoin (BTC) reaches Coinbase Prime, it is a clear sign that the USMS has either sold or is about to sell these assets.
The USMS-Coinbase agreement
Johnsson explained that the USMS has been sending Bitcoin to a custodial address in accordance with the agreement’s terms.
“Given the agreement requires USMS assets remain completely segregated, whenever a transfer is ultimately made to CB prime (or other commingled exchange address), you can be sure USMS has already sold or is selling imminently,” Johnsson wrote.
Source: Scott Johnsson
Formal confirmation of the transactions will come at the latest with the Department of Justice’s Asset Forfeiture Program report for the fiscal year 2024, expected in January. Johnsson also hinted at political motivations behind the timing of the sales, suggesting that the administration of President Joe Biden might continue these actions without pause.
Contradictory views
However, not everyone agrees with Johnsson’s interpretation. Ryan Lee, chief analyst at Bitget Research, believes that despite the initial concerns, the Silk Road Bitcoin is unlikely to be sold.
This stand-off in opinions reflects the broader uncertainty and speculation within the cryptocurrency community regarding government-held Bitcoin and its potential market impact.
Related: US government moves 10,000 Bitcoin
According to onchain analytics firm Arkham Intelligence, the US government transferred nearly $600 million worth of Bitcoin to Coinbase on Aug. 15. The Bitcoin was sent to a Coinbase Prime deposit wallet.
Historically, large transactions by significant holders, known as “whales,” can have a substantial impact on Bitcoin’s price. Investors often track these transactions to anticipate potential selling pressure.
Historical context
The US government is currently the largest geopolitical holder of Bitcoin, a fact underscored by former President Donald Trump. Trump, who is the Republican Party’s 2024 presidential candidate, has pledged not to sell any of the US government’s Bitcoin holdings if reelected, adding another layer of complexity to the issue.
The 10,000 Bitcoin recently transferred were originally seized during the Silk Road raid in 2022. In that operation, the Department of Justice announced the seizure of 50,000 BTC from the dark net marketplace.
This significant onchain movement of funds follows another major transfer in April when the US government moved $2 billion worth of Bitcoin seized from Silk Road.
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