KANALCOIN NEWS – The United States continues to maintain its stance. Not in a hurry to liquidate his fat pile and inadvertently taking the position of a lazy coin holder. Even though Uncle Sam’s country has confiscated around 200,000 BTC from cybercriminals and holds one of the largest Bitcoin deposits in the world.
It’s worth noting that the federal government holds about $5.4 billion worth of Bitcoin. If liquidated, deposits of this size will definitely move the market and increase selling pressure.
Reasons Why BTC is Not for sale
Wall Street says that the United States Government is notoriously slow in converting its Bitcoin savings into dollars. This was done after Wall Street investigated the government’s Bitcoin holdings on October 15. This can cause Bitcoin to have a higher price even if it is done accidentally.
In his statement, the executive director of IRS cyber and forensic services, Jarod Koopman, said, “This large pile of Bitcoin is more a byproduct of a lengthy legal process than strategic planning. And we’re not gaming the market. We are basically time bound in the process that we do.”
The US government stores BTC offline in hardware wallets controlled by agencies such as the Department of Justice and the Internal Revenue Service (IRS).
Due to the lengthy investigation and legal process, it can take years from initial confiscation to liquidation. This is what could open up opportunities for the government to profit from the increase in Bitcoin prices on the market. An advantage that can also be an appreciation of Bitcoin.
Once the case is resolved, the Marshall Service liquidates the Bitcoins and distributes the proceeds to the victim or to reimburse the costs of the investigation.
Although initial liquidations used auctions, now exchanges use crypto exchanges such as Coinbase. The purpose of using the Marshals service is to spread sales to avoid market impact.
“Governments generally move very slowly in releasing these assets because they have to do a lot of due diligence, the cases are often complicated and there is a lot of red tape.” commented Professor of computer science at Carnegie Mellon University, Nicolas Christin.
The government sold bitcoin assets in March of around 9,861 BTC through Coinbase. According to a government spokesperson, this was done simply to sell assets at the right time at a fair market value.
US Government Bitcoin Amount
According to 21.co, the parent company of 21shares, the US government has seized at least 215,000 BTC since 2020. The government has tracked three seizures since 2020 on the Dune Analytic page.
This value consists of several confiscations. Namely the seizure from Silk Road in November 2020 was 69,369 BTC. Bitfinex hack seizures totaled 94,643 BTC in January. Meanwhile, in March 2022, James Zhong’s seizure was 51,326 BTC.
And according to data that has been calculated and tracked by 21.co, the total savings could be more than 194,188 BTC. Overall, it is unlikely that all of these BTC tranches will be liquidated at the same time, thereby causing a market crash.
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