On Thursday at 9:33 a.m. ET, U.S. government-linked wallets moved 12,267 BTC, valued at approximately $1.01 billion, from the seized funds of the Bitfinex hacker to a new, unlabeled address. Blockchain analytics firm Arkham identified the transaction, noting that nearly all coins landed at the new address while 0.0012 BTC went to a second wallet. Although the destination was not an exchange, Arkham data marked both outputs as already spent, indicating subsequent movement. This transfer follows recent activity where government wallets sent about $119 million in USDT and roughly 2,574 BTC to Coinbase Prime on Wednesday, and shifted $288 million in seized crypto to Coinbase Prime in July. Because Coinbase Prime offers custody services, these deposits do not confirm sales.
The Bitcoin involved is part of the approximately 94,000 BTC seized in 2022 from Ilya Lichtenstein and Heather Morgan for orchestrating the 2016 Bitfinex hack. The broader context includes President Donald Trump’s March 2025 executive order directing forfeited Bitcoin into a Strategic Bitcoin Reserve that would not be sold. However, Treasury Secretary Scott Bessent later clarified that the government would explore budget-neutral ways to add to the reserve. Prior to this order, a federal court cleared the way for selling $6.5 billion in Bitcoin seized from Silk Road in January 2025. The U.S. government currently holds about 306,795 BTC, worth roughly $24.85 billion, with Bitcoin trading near $81,000.
The movement of over $1 billion in Bitcoin to an unlabeled address creates ambiguity regarding the U.S. government's adherence to its stated policy of holding forfeited assets in a Strategic Bitcoin Reserve. While transfers between internal wallets are common for security or operational reasons, the fact that Arkham marks the outputs as already spent suggests further liquidity events may have occurred. This opacity contrasts with the explicit directive from the March 2025 executive order to refrain from selling such reserves, raising questions about whether these movements represent custodial reorganization or unauthorized liquidation attempts.
Institutional observers must distinguish between custody transfers and market sales, particularly given the recent routing of assets through Coinbase Prime. Since Coinbase Prime provides custody solutions, deposits there do not inherently signal a sale, yet the volume of recent moves—totaling hundreds of millions in USDT and Bitcoin—indicates active management of the federal crypto portfolio. The tension between the executive order’s non-sale mandate and the practical need to manage vast holdings highlights potential regulatory friction. Future clarity depends on whether the Treasury Department confirms these transactions remain within the reserve framework or if they precede public auction announcements.
