- Nearly $2 billion worth of forfeited bitcoin (BTC) linked to the Silk Road website were moved to crypto exchange Coinbase Prime on Monday.
- The transfer likely indicates that the U.S. government is preparing to sell or has already sold the seized assets.
- The last confirmed sale of Silk Road assets by the government was in March 2023, selling nearly 10,000 BTC for $216 million.
The U.S. government has transferred nearly $2 billion worth of seized Bitcoin linked to the now-defunct Silk Road dark web marketplace to Coinbase Prime. This likely signals an impending sale of the assets by the government.
Bitcoin Transferred from Government Wallet to Coinbase
On Monday, a wallet labeled “U.S. Government: Silk Road DOJ Confiscated Funds” moved 19,800 Bitcoin to a new address with no transaction history. This address then deposited the funds to Coinbase Prime, according to blockchain data from Arkham Intelligence.
The transferred Bitcoin is worth nearly $2 billion at current prices. After this move, the U.S. government still holds around $18 billion in seized crypto assets related to the Silk Road case, per Arkham’s data.
Transfer Likely Precedes Government Sale
The transfer to Coinbase Prime likely means the government is preparing to liquidate some or all of the seized Silk Road Bitcoin. When the government has sold confiscated Bitcoin in the past, it has sparked notable price declines.
However, the market reaction has been relatively muted so far following this latest transfer. Bitcoin’s price dipped just over 1% to around $95,800 after the news emerged.
Background on the Silk Road Bitcoin Seizure
The Bitcoin originates from the U.S. government’s seizure of over 50,000 BTC linked to the Silk Road case in 2022. Silk Road was a dark web marketplace enabled by Bitcoin, known for the sale of illegal drugs and other illicit goods.
The Department of Justice alleged James Zhong manipulated the transaction system on Silk Road in 2012 to steal the Bitcoin. Zhong pled guilty to wire fraud related to the theft.
Plans to Sell in Tranches
Last month, a U.S. court requested all involved parties agree the government can liquidate some or all of the seized Silk Road crypto assets. This is taking place amid an ongoing Freedom of Information Act lawsuit related to the forfeited Bitcoin.
The government last confirmed selling Silk Road Bitcoin in March 2023, when it liquidated nearly 10,000 BTC for $216 million. Filings at the time outlined plans to sell the remaining assets in a series of four tranches during 2023.
Earlier this year, the U.S. Marshals Service partnered with Coinbase Prime to assist in selling off the government’s seized cryptocurrency.
