Monday, 27 March 2023

US Government Remains a Top Bitcoin Holder With Seized Stash Valued at $5.6 Billion

by Earn Media

US Government Remains a Top Bitcoin Holder With Seized Stash Valued at .6 Billion

As of March 25, 2023, the U.S. government held 205,515 bitcoins worth $5.6 billion, which is approximately 1.06% of the circulating supply, according to current statistics. The cache of bitcoins is a result of three forfeitures that began in 2020. Glassnode’s on-chain data reveals that on March 9, about 9,860 bitcoins worth roughly $269 million were sent to a Coinbase address.

Uncle Sam’s Crypto Stash: How the U.S. Government Became a Top Bitcoin Holder

The U.S. government currently holds 205,515 bitcoins valued at $5.66 billion based on today’s exchange rates. The bitcoins were confiscated in three cases, including the Silk Road bitcoin seizure in November 2020, the 2022 Bitfinex hack confiscation, and the seizure of bitcoins from James Zhong last year. Of the total, 69,369 BTC was seized from “Individual X,” 94,643 BTC was taken from Ilya Lichtenstein and his wife Heather Morgan, and 51,326 BTC was seized from Zhong in November 2022.

According to a report from Glassnode on March 9, 2023, some of these bitcoins have moved, reducing the total from 215,338 to 205,515 BTC. “Approximately [40,000 bitcoins] from wallets associated with U.S. Government law enforcement seizures are on the move,” Glassnode reported. “The majority of these appear to be internal transfers (so far). However, around 9,861 [bitcoin] seized from the Silk Road hacker have been sent to our Coinbase cluster.”

The current estimate of 205,515 bitcoins (BTC) comes from a Dune Analytics set of metrics created by 21Shares, an exchange-traded product provider. The data shows the U.S. government’s addresses and transaction history. Of the current seized cache of BTC, 44% came from the Bitfinex forfeiture, 32.2% from “Individual X,” and 23.8% from the Zhong seizure. Additionally, the U.S. government may possess more bitcoins than what is tallied up in 21Shares’ data set. The summary notes that the 205,515 BTC is “a lower-bound estimation” based solely on “publicly available information.”

The U.S. government’s seized 205,515 bitcoins constitute a considerable stash compared to that of other large holders. Although smaller than Grayscale’s cache of 643,572 BTC, it surpasses Microstrategy’s stash of 132,500 BTC. Furthermore, compared to the whales in the bitcoin-rich list of addresses, it would be the second largest (if consolidated), falling behind Binance’s bitcoin cold wallet, which holds 248,597 BTC at the time of writing.

The federal government’s bitcoin stash is also larger than the roughly 140,000 BTC in the Mt Gox cache. This isn’t the first time the U.S. government has been a top holder; the Federal Bureau of Investigation (FBI) was the second-largest BTC holder after seizing the original Silk Road marketplace. However, the government’s stash at that time was depleted after the U.S. Marshals held bitcoin auctions to sell the crypto assets in 2014.

What do you think about the U.S. government’s current bitcoin stash? Share your thoughts in the comments section below.