Bitcoin (BTC) is down more than 12% in price from its all-time high above $108,000 reached last month, but those losses could be about to widen further as the US government sells off.
The United States Department of Justice (DOJ) has received authorization to sell approximately 69,370 bitcoins valued at around USD $6.5 billion, DB News reported on Wednesday.
The bitcoins are the product of a seizure in the well-known Silk Road case, a former illicit darknet drug market that operated with Bitcoin payments, according to the report. The sales order came in the wake of a court ruling on December 30, ending a years-long legal dispute over Bitcoin ownership, the coverage notes.
US prosecutors had requested expedited permission to sell the cryptocurrencies, citing price volatility as a key reason to avoid further delays.
A federal judge rejected bid attempts by Battle Born Investments — which had claimed the bitcoin stash through bankruptcy — to delay the sale, ruling in favor of prosecutors.
Officials have now confirmed that they plan to sell the assets worth billions of dollars within no more than two weeks, before the incoming Donald Trump administration takes office on January 20.
Crypto-friendly Trump expressed intentions to create a strategic Bitcoin reserve when he takes office in 2025, proposing to hold bitcoins that the US government has confiscated for years. US government wallets currently hold 198,109 BTC valued at about $18.5 billion, according to Arkham data.
The US government has carried out other sales of seized cryptocurrencies in the past, and it is possible that this time, authorities are looking to capitalize on current market conditions. Bitcoin rose more than 110% in price during 2024, reaching unprecedented price levels above USD $100,000 per unit.
The US government has carried out other sales of seized cryptocurrencies in the past, and it is possible that this time, authorities are looking to capitalize on current market conditions. Bitcoin rose more than 110% in price during 2024, reaching unprecedented price levels above USD $100,000 per unit.
The development, however, could have negative implications for the broader cryptocurrency market, potentially generating selling pressure that would downwardly impact Bitcoin's already depressed price.
A year ago, U.S. authorities announced plans to sell more than $130 million worth of Bitcoin, which was confiscated during the Silk Road investigations, later generating downward pressure on the market. Also the liquidations of more than USD $2.8 billion from the German government in mid-2024 momentarily impacted prices.
Source: Hannah Estefanía Pérez / DiarioBitcoin.
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