In a development that’s causing ripples across the cryptocurrency market, the United States Government has reportedly transferred a massive stash of Bitcoin, amounting to approximately $240 million, to Coinbase Prime. The transaction involves seized Bitcoins from Banmeet Singh, a convicted drug trafficker, effectively turning the US Government into the largest Bitcoin holder globally.
The government’s transfer consisted of a staggering 3,940 Bitcoins. With the amount of cryptocurrency the US Government holds, to the tune of 213,546 Bitcoins valued at around $13.07 billion, the potential selling power the government has over the market is substantial. This makes the government the most significant holder of Bitcoin globally.
Market watchers see this movement of a considerable sum of Bitcoins to a centralized exchange like Coinbase as a clear sign of preparation for a potential sell-off in the open market. While the government’s transfer directly to Coinbase Prime does not necessarily mean an immediate sale, such an action typically precedes a liquidation.
As news of the transfer became public, the price of Bitcoin has experienced a slight downturn, with a 0.31% drop in the last 24 hours, trading at $61,192. Over a broader timeframe, Bitcoin has dropped by 7.79% in the past week and by 10.56% in the past month.
Other significant transactions have also been observed recently, including the transfer of 400 BTC by the German government and 1,700 BTC sent from various entities to exchanges such as Coinbase, Kraken, and Bitstamp. These large transactions further suggest a trend of governments and institutions moving large amounts of Bitcoin, potentially to liquidate holdings.
Moreover, the repayment proceedings by Mt. Gox, which is set to start repaying creditors with Bitcoin and Bitcoin Cash, allocate about 142,000 BTC for this purpose. This is another event that market participants are carefully monitoring as it involves a notable amount of Bitcoin hitting the market.
The recent activities hint at a possible increase in market liquidity as these significant Bitcoin holdings begin to move. The US Drug Enforcement Administration (DEA) has referred to the government’s stash as the “largest seized cryptocurrency haul ever,” which underlines the magnitude of the government’s current position in the market. With these movements, investors and traders are keeping a watchful eye on how these sales might impact Bitcoin’s market price and overall volatility.
