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The US government has moved 10,000 Bitcoin related to the Silk Road seizure to Coinbase Prime.
Arkham highlighted the transaction, which saw $593.5 million worth of Bitcoin move from a known US government wallet (U.S. Government: Silk Road DOJ Confiscated Funds) to wallet bc1ql two weeks ago but was then transferred to 3JJ, a Coinbase Prime deposit wallet.
In 2022, the Department of Justice (DOJ) seized more than 50,000 BTC when it arrested James Zhong for allegedly manipulating the Silk Road dark web market's transaction system in 2012. Zhong pleaded guilty to wire fraud.
The government sold 9,861 of the Silk Road BTC for $216 million in March 2023 and planned to sell the remaining assets in four tranches over the remainder of the year but did not provide an update.
Blockhead
Arkham data shows the US government wallets hold $12 billion of BTC and smaller amounts of other seized crypto.
Last month, the DOJ's US Marshal Service announced a partnership with Coinbase Prime to "safeguard and trade its “Class 1” (large cap) digital assets."
The government's transaction comes amid fears of a wider Bitcoin sell-off as Mt Gox and Jump Trading off-load significant amounts of crypto. Earlier this week, Mt. Gox transferred $2 billion worth of Bitcoin as a test transaction ahead of completing his distribution repayments to creditors.
Blockhead
Meanwhile, Jump Trading moved another 17,049 ETH from Lido on 14 August and began withdrawals. It also redeemed its remaining 21,394 WSTETH and 3,124 RETH into STETH.
Jump now holds over 28,000 STETH and over 24,000 ETH. The firm withdrew assets to centralized exchanges, including Binance, Coinbase, and OKX.
Blockhead
Earlier this month, Jump Crypto unstaked $300 million worth of crypto. Over 120,000 staked Ether have been liquidated since 24 July, which was the day after Ethereum ETFs launched in the US.
Increased Selling Pressure
Transfers from US Government and Jump Trading have increased selling pressure on BTC, BRN lead analyst Valentin Fournier said in a note on Thursday.
"Despite the positive CPI data, Bitcoin has dipped slightly to around the $58,500 support zone. This movement is largely due to significant transfers of assets to exchanges by the US government (BTC) and Jump Trading (ETH), signaling a potential sell-off. However, we expect this support level to hold, allowing Bitcoin to resume its upward trend. As we expect imminent rate cuts to be announced that would alleviate the pressure on risk-on assets, we believe that Bitcoin will keep rising towards $65-68K in the near term," Fournier said.
