US govt sent $594m Silk Road Bitcoin to Coinbase

Silk Road Bitcoin saw renewed activity after a US government wallet sent 10,000 BTC to Coinbase.

According to Arkham Intel, the US government transferred $593.5 million worth of Bitcoin (BTC) to its preferred crypto brokerage platform Coinbase Prime on August 14. US authorities sent this 10,000 Bitcoin tranche to the “bc1ql” wallet two weeks ago.

BTC fell 3.6% following the news, but the price decline began before Coinbase Prime acquired the seized Silk Road funds. After the initial market surge due to positive CPI data, one BTC is now worth around $59,100.

24-hour BTC chart as of August 14 | Source: crypto.news Is America reducing its Bitcoin war chest ahead of the election?

In late July, the US government also sent $2 billion worth of BTC, with the recipient believed to be Coinbase. Authorities moved the BTC trove shortly after former president Donald Trump promised to create a strategic Bitcoin reserve, crypto.news reported, citing statements from Gemini co-founder Tyler Winklevoss.

Speculations abound as to whether the current administration plans to divest some or most of its BTC holdings ahead of the winter elections. Despite the recent transfers, America remains the largest sovereign BTC holder with more than $11 billion worth of Bitcoin.

Meanwhile, US Senator Ted Cruz has joined the pro-BTC chorus. Speaking at the Texas Blockchain Council, Cruz called the cryptocurrency a “power reservoir” for electric grid systems in Texas.

More selling pressure

Selling pressure and additional volatility may emerge in the BTC market due to the possible liquidation of Coinbase by the US government.

In addition to the $2.5 billion transferred by American authorities, Mt. Gox customer refunds are also continuing. Crypto exchange BitGo received $2 billion in BTC from the Mt. Gox Trustee, and some claimants may be able to profit.

It is not yet clear how BTC will respond to this sell demand, but spot BTC exchange-traded fund inflows could offset market declines.