Analysts estimate that since 2020, the US government has confiscated bitcoin valued at least $5.5 billion.
Its holding places it among the biggest cryptocurrency “whales” in the world.
The amount of bitcoin it keeps or sells might have a significant effect on the token’s value.
The US government is the owner of bitcoin worth billions of dollars, and its decision to sell or keep might have a significant effect on the price of the cryptocurrency.
According to 21.co, a cryptocurrency company, Washington has taken over 200,000 tokens from hackers since 2020, as evidenced by public documents.
Why Does the US Government Hold $5.5B Worth of Bitcoin Assets?,Why Does the US Government Hold $5.5B Worth of Bitcoin Assets?
Analysts calculated that its holdings are worth a total of $5.5 billion, placing the US among the world’s greatest bitcoin “whales”—a phrase used by fans of digital assets to describe individuals or entities who possess substantial quantities of the cryptocurrency.
Much of the government’s bitcoin hoard is made up of tokens that were taken from the Silk Road online illicit market, its creator James Zhong, and criminals who hacked the Bitfinex exchange back in 2016, according to statistics from 21.co.
Historically, following the conclusion of pertinent legal actions, the government has disposed of its stakes by auction and used the proceeds to compensate victims.
For instance, the Wall Street Journal reported that in July, Washington paid Bitfinex $300,000 in compensation after selling 9,861 previously confiscated bitcoins through Coinbase in March.
With trading volumes for digital assets coming to a complete standstill during the past year, the government’s sales might theoretically sway the price of the token that is largest in the world by total market value.
Cryptocurrency prices crashed in 2022 as investors’ enthusiasm for the space was dampened by the Federal Reserve’s aggressive interest-rate rises and the failure of well-known businesses like FTX.
Despite a surge in riskier assets this year, Bitcoin fell below $20,000 and has scarcely recovered. Since mid-March, the currency has only traded in a small range between $26,000 and $31,000.
Because whales may now cause large swings in price on their own due to lower volatility, the government’s decision over what to do with its $5.5 billion hoard might have a significant effect on the price of bitcoin.
Why Does the US Government Hold $5.5B Worth of Bitcoin Assets?,Why Does the US Government Hold $5.5B Worth of Bitcoin Assets?,Why Does the US Government Hold $5.5B Worth of Bitcoin Assets?, Bitcoin Crypto news, Bitcoin News