Bitcoin (BTC) experienced a drop towards $60,000 following the movement of approximately $240 million worth of seized BTC to a Coinbase Prime address linked to the U.S. Government. This action has sparked concerns among traders regarding potential selling pressure on the digital asset.
According to Arkham Intelligence, a wallet associated with the U.S. Government transferred 3,940 bitcoins that were originally seized from a Silk Road vendor. The BTC was initially confiscated from narcotics trafficker Banmeet Singh and forfeited at trial in January 2024.
Notably, this is not the first instance of the government moving significant amounts of bitcoin seized from illicit activities. In late 2022, around 50,000 bitcoins related to the Silk Road website were seized by the authorities. The recent movement of $240 million worth of BTC follows a previous transaction of $2 billion in April 2024, which also impacted the digital asset markets. The government had previously sold 9,861 coins for $216 million in March 2023.
Following the latest news, bitcoin initially dipped below $61,000 but has since recovered to $61,100, marking a 1% decrease over the past 24 hours. The broader CoinDesk 20 Index also experienced a similar decline, reflecting the cautious sentiment in the market. Ether (ETH) also saw a 1.6% decline in response to the developments.
The movement of seized bitcoins by government entities often raises questions about their potential impact on the overall market dynamics. Traders and investors closely monitor such transactions to gauge the short-term and long-term implications on cryptocurrency prices and market sentiment.