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According to a market crypto market analyst, the 118 million dollar Bitcoin waiting to be sold by the US government can be seen as a drop in the bucket compared to GBTC outflows. He then noted that the planned sale of more than 2,900 Bitcoins is small compared to the outflows in Grayscale’s ETF.
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The US government, which plans to sell 118 million dollars worth of Bitcoin seized from Silk Road scammers, plans to sell these assets.
This sale does not raise much concern from commentators.
GBTC has sold 106,575 BTC worth $4.2 billion since it converted to a spot Bitcoin exchange-traded fund on January 11, and the latest outflow was 10,871 BTC on January 24.
It is thought that the Bitcoins seized by the US government were seized in three different ways. It is currently only 1.5% or $7.7 billion of the 194,188 BTC they have. According to data from crypto firm 21.co, the number of Bitcoins they have in terms of quantity has appeared in criminal cases that are less than 1% of the circulating supply.
How Were the Bitcoins Seized?
These 194,188 Bitcoins were seized in three different ways by the US government.
94,643 BTC were seized in the 2016 Bitfinex attack in January 2022.
69,369 BTC were seized from the Silk Road in November 2020.
51,326 BTC were seized from Silk Road hacker James Zhong.
The US government planned to sell 41,000 of the Bitcoins it held by the end of 2023. However, we know that the government uses the auction method. In an auction, risk capital investor Tim Draper bought about 30,000 BTC in 2014.
In recent times, the US government has turned to selling seized cryptocurrencies on exchanges instead of auctions. The latest known sale of 9,118 BTC took place in March 2023.