On Wednesday, August 14, a second transfer of Bitcoin originally confiscated from the notorious Silk Road by the US Government has caused widespread speculation. Arkham, an analytics firm that specializes in blockchain, announced yesterday 10,000 Silk Road BTC worth approximately $593.55 million were transferred by the US government to Coinbase Prime. Coinbase Prime is a platform primarily used for institutional investors.
Arkham Asylum’s Official Website post X: Silk Road BTC (worth $593,5M) has been moved from Coinbase Prime to X. Last week, wallet bc1ql was sent 10K BTC by a well-known US Government wallet. The BTC was just sent to Coinbase Prime Deposit wallet 33J.”
What is the US government doing with Bitcoin?
It follows a recent announcement by the US Marshals Service part of Department of Justice detailing a new partnership between Coinbase Prime and the USMS to provide advanced trading services, as well as custody for their agency. “Class 1” (large cap) digital assets. Community members are divided over whether this move represents the sale of Bitcoin, or simply a transfer to facilitate custody. Many people speculated, therefore, that the US Gov is not selling.
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Scott Johnsson is a lawyer who specializes in finance and he’s a general partner of Van Buren Capital. expressed Today, there is a different view. It argues that this transaction signifies a sale definitive of the seized assets By the US Government. Johnsson remarked:
“Yes, US Marshal Service (USMS) is almost certainly selling silk road Bitcoin […] USMS has been sending BTC to a custodial address required by the terms of the servicing agreement […] Given the agreement requires USMS assets remain completely segregated, whenever a transfer is ultimately made to CB prime (or other commingled exchange address), you can be sure USMS has already sold or is selling imminently.”
Johnsson supported his claim further by citing the DOJ Office of Inspector General’s (OIG), report, and the Crypto Services Agreement RFP. Both stipulated the liquidation of forfeited assets in five working days and that wallet addresses must be segregated to avoid co-mingling.
This is what it says: “The USMS intends to resolve this issue using its planned cryptocurrency services contract, which will require the contractor to liquidate cryptocurrency within 5 business days of the asset being forfeited.”
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Johnsson believes that the DOJ Asset Forfeiture Program report FY2024, which is due to be published in January, will not provide a formal confirmation. As events unfold, more information may become available from official channels and subsequent movements of assets.
“Official confirmation will definitively come (at the latest) upon the DOJ’s Asset Forfeiture Program FY2024 report in January, if not earlier. I also don’t think it’s a coincidence this began in earnest following the Trump speech.”
Users of X were confused by Johnsson’s analyses. Rodeo queried: “These coins were supposed to be sold by the end of last year[…] You’re saying the act of transferring these coins to Coinbase from their current address is enough to imply selling because the Coinbase addresses are not completely segregated addresses?”
Johnsson responded to this concern by clarifying: “Not necessarily Coinbase alone (there’s an interim segregated custody step), but once they hit commingled addresses it’s reasonable to infer they’re sold. And yea, there was a backlog of forfeited BTC that was supposed to be sold already. Finalizing the services agreement appears to have been (at least part of) the hold up.”
The latest BTC transactions by the US Government come just weeks after Republican Presidential candidate Donald Trump proposed to establish a “strategic national Bitcoin stockpile” At the Bitcoin 2024 Conference. Then, there were rumors that Democrats led by Kamala Harri could free the BTC held by the US Government from confiscation. Harris pleads Based on her latest actions, many experts reject this claim.
BTC was trading at $59.336 as of the time this article went to press.
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Source: www.newsbtc.com