While the cryptocurrency market fell amid concerns that the Federal Reserve would increase the dose of aggression, the US government, which owns $ 1 billion worth of Bitcoin due to Silk Road, mobilized BTCs. This is ‘Is a large amount of sales coming? begs the question.
Silk Road BTCs dumped on exchanges!
The US government moved $1 billion in Bitcoin (BTC), which it seized from the anonymous ‘darknet’ marketplace Silk Road in 2021 and 2022. Blockchain security firm PeckShield announced in a post on March 8 that BTC is part of what was seized in 2021 and 2022.
#PeckShieldAlert 49k $BTC (worth $1 Billion) from wallets related to US Government law enforcement seizures have been transferred to #Coinbase (~9.8k $BTC, worth $217M), bc1qf2…fsv (30k $BTC) & bc1qe7…rdg (9k $BTC) #SilkRoad pic.twitter.com/4MzlvDzkut
— PeckShieldAlert (@PeckShieldAlert) March 8, 2023
As you follow on Kriptokoin.com, between November 2021 and March 2022, the US government confiscated approximately 51,351.9 BTC from Silk Road crime proceeds. According to PeckShield, BTC has so far been held at two government addresses: bc1q5s…0ch and bc1q2ra…cx7. At that time, BTC was worth roughly $3.39 billion.
Glassnode, another well-known crypto market intelligence platform, also noticed an unusual BTC movement. Most transfers were internal, including close to 10,000 BTC sent to Coinbase. Glassnode reports that a total of 40,000 BTC has been moved by government regulators.
Source: GlassnodeSilk Road money laundering case
Silk Road was a black market platform notorious for its money laundering activities. US regulators shut down the platform, which was founded by Ross Ulbricht in 2011, in 2013 on suspicion of engaging in illegal activities. After a series of investigations and house searches, the tracks were traced back to Ulbricht, who is currently serving a life sentence for the crime, and the BTCs were confiscated as proceeds of crime.
Silk Road was one of the pioneering websites to accept BTC, and since becoming known as a money laundering platform, Bitcoin and crypto have had a complicated reputation with the government ever since.
Impact of Bitcoin movements on BTC price
One of the fears when there are big BTC movements like this is that if Bitcoin goes to an exchange, there could be a big drop in the price of the asset. Although the BTC price dropped slightly from $22,469 to $22,000 after the event, only about 10,000 BTC (about $217 million) went to Coinbase and was likely sold. According to experts, this is not very worrying as long as all 49,000 BTC is not sold.
Bitcoin price is currently at $22,059. However, a larger drop is possible if the remaining 39,000 BTC is moved to Coinbase or another exchange. Because this is likely to trigger a panic selling.
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