The United States government has transferred 29,800 BTC, worth approximately $2 billion, from a wallet associated with seized Silk Road funds to an unknown address. This move has caused a 1.3% drop in Bitcoin's price, which is currently trading at around $66,890.
The transfer originated from a wallet labeled "U.S. Government: Silk Road DOJ Confiscated Funds (bc1qj)" and was split into two transactions: one for 27,799 BTC and another for 0.001 BTC. The reason for the transfer remains unclear, but it has raised concerns among investors about a potential sell-off.
This is not the first time the U.S. government has moved significant amounts of Bitcoin. In July, the government transferred 237 BTC worth $14 million from funds seized from Estonian crypto entrepreneurs involved in a fraud scheme. Last week, another 60 BTC worth $4 million was transferred to Coinbase Prime, a custodian recently awarded a contract by the U.S. Marshals Service to manage and dispose of its large-cap crypto holdings.
The timing of this latest transfer is particularly notable, as it comes just two days after former President Donald Trump announced his plan to establish a "strategic national Bitcoin stockpile" if elected in 2024. Trump's speech at the Bitcoin 2024 conference in Nashville and Senator Cynthia Lummis' subsequent announcement of legislation aimed at keeping the government's Bitcoin holdings sparked a rally that pushed Bitcoin's price to a high of $70,000 before the recent dip.
The crypto community has reacted strongly to the news, with some criticizing the timing of the transfer as "tone deaf" and suggesting it is an attempt to "hurt the price and investors." However, others have urged calm, noting that such transfers between wallets and custodians are routine and do not necessarily indicate an imminent sale.
The U.S. government still holds over 213,000 BTC worth $14 billion, according to data from Arkham Intelligence. The potential selling pressure from the latest transfer represents less than 1% of Bitcoin's 24-hour trading volume, which is unlikely to significantly impact the spot price.
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