Why is the US holding $5 billion in Bitcoin?
To date, the US has seized 200,000 Bitcoins from cybercrimes and darknet markets. This has made the US one of the world's largest BTC holders.
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An analysis in the Wall Street Journal stated that the US is the largest BTC holder that does not care about the price.
THE US IS STORING 200,000 BTC IN WALLETS
The Wall Street Journal examined the Bitcoin holdings of the US. The report noted that while the US is one of the largest BTC holders, unlike other whales, it does not care about the price. 200,000 BTC were seized from cybercriminals and darknet markets. It was noted that the BTCs are kept in hardware wallets controlled by the Department of Justice, the Internal Revenue Service, or other agencies.
The US arrested Bitfinex hacker Lichtenstein and his wife Heather Morgan in 2022. It was announced that 95,000 BTC were seized in this operation. The Department of Justice has been storing the BTC seized since the shutdown of the online drug marketplace Silk Road in 2013 in hardware wallets. The agency seized 69,000 BTC belonging to Silk Road founder Ross Ulbricht and 50,676 BTC from a man in Georgia who was found guilty of stealing tokens from the marketplace.
WHEN WILL THE US CONDUCT CRYPTO SALES?
Crypto investors have long been closely monitoring the BTC held by the US. It has been stated that any sale could cause fluctuations in the $1 trillion digital asset market. On the other hand, the US has been quite slow in converting its BTC holdings into dollars. It was stated that the slow progress of the process is due to legal procedures rather than the price. Regarding the matter, Jarod Koopman, Executive Director of the IRS Cyber and Forensic Services Section, said, "We don't play the market. We are basically set by the timing of our process. The timing is determined by our process."
According to an analysis by crypto firm 21.co, 200,000 BTC have entered the government's coffers through the last three operations. This figure corresponds to a value of more than approximately $5 billion. It was stated that the total amount owned by the government could be much larger. Nicolas Christin, a professor at Carnegie Mellon University, said, "The government usually moves very slowly to dispose of these assets. They need to perform due diligence, the cases are often complex, and there is a lot of bureaucracy."