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- The WSJ has revealed that the U.S. government is one of the largest holders of Bitcoin (BTC) with billions worth held in their addresses.
- Unlike most holders, the government has little interest in whether the price goes up or down.
Through some high-profile busts of cyber criminals and unscrupulous platforms being taken down by authorities, the U.S. government has become one of the largest Bitcoin (BTC) holders in the world. According to the Wall Street Journal (WSJ), the U.S. government holds around 200,000 Bitcoin. At current prices, this stash is worth more than $5 billion.
Unlike most holders, the US government has neither acquired these stashes through open market purchases nor mining. Instead, the respective authorities have amassed these amounts through seizures. Furthermore, the government is usually not concerned whether the price of BTC goes up or down, something unfamiliar to other holders.
Over the years, the government through its enforcement agencies has run some high-profile operations involving cyber criminals and illegal platforms and darknet platforms.
One example is the famous online drug marketplace Silk Road whose closure in 2013 allowed the government to seize a significant amount of Bitcoin. Similarly, the Bitfinex cyber attack from around six years ago resulted in the Justice Department securing a significant amount of Bitcoin. Cases against Ilya Lichtenstein and his wife, Heather Morgan, further contributed to these figures.
Because of the complexity of some of these cases, it takes years before the government can take action on the holdings. Often, when legalities are settled, the U.S. Marshals Service is tasked with liquidating the digital assets. However, depending on the amount, these events sometimes have an effect on the prices. Investors are always wary of the government putting out too much into the market which would drive demand down and negatively affect prices.
U.S. Government Gaining from Bitcoin (BTC) Rise
For the government, these seizures have proven to be fairly profitable as the digital asset has been consistently increasing in value. For example, in 2013, BTC was trading at around $1,100. The price has since drastically risen and any stash seized from the Silk Road closure has made massive profits.
At the time of press, BTC is trading for $28,125 after an increase of nearly 5 percent in the last 24 hours. This comes after rumors of a Bitcoin spot ETF approval by the SEC in the U.S. which had momentarily driven BTC to $30,000. Although the ETF has not yet been approved, many experts believe the event will likely take place in the next couple of months. Additionally, the upcoming 2024 Bitcoin halving will play a significant role in the growth of the digital asset’s value.
