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Amid speculation, the US government’s $590 million Bitcoin transfer to Coinbase is not expected to result in a sale, according to industry analysts.
10,000 Bitcoin Transferred to Coinbase by US Gov’t
It is highly improbable that the approximately $600 million worth of Bitcoin that the US government has transferred to Coinbase will result in selling pressure.
The US government sent 10,000 Bitcoin, valued at more than $593 million, on August 15th.
Onchain analytics company Arkham Intelligence said that the Bitcoin was deposited to a Coinbase Prime deposit wallet.
Bitget Research's principal analyst Ryan Lee said that, despite early worries, Bitcoin is not going anywhere. What Lee stated to Cointelegraph was:
“This does not mean that 10,000 Bitcoin have already been sold. Last month, the US Marshals Service, an agency under the US Department of Justice, announced a partnership with Coinbase Prime to ‘safeguard and trade’ large digital assets.”
$590M Bitcoin Sale Not Expected
Large Bitcoin holding entities, or "whales," can dramatically affect the price of Bitcoin. In order to predict when selling pressure might be about to hit, investors frequently monitor the moves made by major holders.
There may have been a hint of a desire to trade big market cap cryptocurrencies like Bitcoin in August when Coinbase and the US Department of Justice (DOJ) reached an agreement.
According to Lee, though, the government might have just moved the assets into safekeeping rather than engaging in active trading:
“After all, Coinbase is the primary custodian for US ETFs, and it is a possibility that the US government entrusted the BTC to Coinbase for safekeeping.”
$590M Sale Seen as Highly Improbable
Furthermore, given the present market liquidity, a transaction of nearly $600 million would have a significant impact on Bitcoin, making it highly implausible, as pointed out by Lee:
“Based on the current price performance, while there is a possibility of it being sold in the market, it is not very likely.”
Not long ago, Trump brought attention to the fact that the United States is the biggest geopolitical Bitcoin holder. Upon becoming president, he pledged to keep the United States government's Bitcoin assets in cold storage.
Silk Road Seizure Includes 10,000 BTC Now Moved
In 2022, when the DOJ revealed that they had taken 50,000 BTC from the dark web marketplace Silk Road, the freshly moved 10,000 BTC were among those seized.
The United States authorities made the first substantial onchain transfer of the $2 billion worth of Bitcoin confiscated from Silk Road at the start of April.
For over a decade, users could purchase and trade illegal products on the now-defunct Silk Road bazaar. This included everything from drugs and firearms to stolen credit card details.
In 2013, its founder, Ross Ulbricht, was arrested by US authorities. He has two life sentences with no chance of parole.
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