By Gabriel Joyce
Bitcoin slipped below $67,000 amid the speculation that the US government could liquidate a portion of its crypto holdings after moving $2 billion worth of BTC.
Blockchain research firm Arkham Intelligence revealed that a wallet attributed to the US government transferred Bitcoin worth $2 billion to a new address. The transfer raises concerns as it comes days after GOP candidate Donald Trump pledged to turn the BTC holdings into a strategic reserve if elected in November.
Silk Road Bitcoin Moved?
Arkham spotlighted the $2 billion transfer in Bitcoin linked to the crypto seized during the crackdown on Silk Road – the dark web marketplace. The on-chain data by Arkham revealed that the transaction was destined for an unidentified wallet.
The move contrasts the declaration by the Republican candidate in the 2024 presidential election plans to keep 100% of the BTC holdings. The former president informed the Bitcoin 2024 audience of the intention to have a national strategic Bitcoin stockpile and urged the holders never to sell their BTC. The move will involve freezing the sale of Bitcoin the government seizes.
By press time, it is uncertain if the US plans to replicate the German sell-off of today’s transferred Bitcoin. Neither the Department of Justice nor the Treasury has yet to clarify the event. Nonetheless, the move routinely spooks traders, with the price slipping by over 2% the hour after the disclosure, per CoinGecko.
Bitcoin Price Slips
The $2 billion transfer eroded the steam that fueled Bitcoin to touch $70,000 on Monday morning ET briefly. The gain is shortlived, with the price plunging below the 2021 all-time high (ATH) of $69,044 to change hands at $66,845.
The price dip arose from the Silk Road BTC movement, with the crypto community erupting on X (formerly Twitter) led by Galaxy Digital chief Mike Novogratz. The executive exclaimed at the dump move, signaling the party behind was tone deaf.
Nonetheless, venture capitalist Adam Cochran calmed the crypto community by pointing out that the US Marshals Service (USMS) had earlier this month engaged Coinbase Prime to manage and sell its sizable crypto assets. He decried the community for freaking out every time during large coins transfer, as such does not necessarily indicate an intention to sell.
The government often holds the Bitcoin it seizes from criminal actors, though it occasionally moves it between custodians and wallets. The authorities are not quick to liquidate the crypto scribed, though they have executed such transactions in the past.
Whether the US Government executes the moves or others are behind such transactions often leaves the traders pondering. Such played out on the news of the German government sending BTC to crypto exchange. The aftermath was increased selling pressure that took down the asset to below $55,000 though ultimately rebounded to early June figures.
Is the US Liquidating Silk Road Bitcoin?
The BTC moved earlier today arose from the seizure of Silk Road – a black market platform that facilitated the sale of prohibited drugs. The authorities shut down the platform a decade ago, with the Feds confiscating the BTC utilized on the website to purchase the goods.
Before the $2 billion move, the US held $12 billion worth of BTC per Arkham Intelligence. The Arkham analysts disclosed some $670 million of BTC to the address considered to belong to an unidentified institutional custody or service provider.
The sizable transaction sparked investor concerns in the process, tanking the retreating prices, where Bitcoin slid nearly 5% from the session highs. Selling pressure prompted the investors to dispose of the assets, contrary to Donald’s promise to stack BTC.
Arkham Intelligence indicates that the wallet tagged as Silk Road DOJ executed the 29,800 BTC to an unlabeled address lacking a prior history of transactions. The address would forward the transfer into a split of 19,800 BTC and 10,000 BTC to a pair of addresses, with the latter valued at $670 million for institutional custody or service.
Traders are aware that prior movements often precede impending asset sales freaked out, causing the BTC to tumble below $67,000 from its session high.
