Bitcoin experienced a 2% drop following the U.S. government’s transfer of 3,940 Bitcoin seized from a Silk Road vendor. The cryptocurrency, worth $240 million, was moved to a Coinbase Prime Address. The BTC was originally confiscated from Silk Road vendor Banmeet Singh in a January trial.
Silk Road was a dark web marketplace founded by Ross Ulbricht in 2011. The FBI arrested Ulbricht in 2013 and shut down Silk Road. In 2022, U.S. law enforcement seized around 50,000 BTC from the platform. Authorities have confiscated Silk Road BTC on multiple occasions.
In April, the wallet connected to U.S. authorities transferred $2 billion in BTC, leading to speculation about potential selling. The recent transaction on Wednesday caused a slight decline in the overall cryptocurrency market, including Bitcoin.
In March 2023, the U.S. government sold $216 million in BTC on Coinbase’s institutional platform, Coinbase Prime. Despite facing scrutiny for violations and illegal conduct, Coinbase remains the preferred off-ramp for government liquidations. The SEC has charged Coinbase with operating an unregistered securities exchange and unlicensed broker-dealer under chair Gary Gensler. Coinbase has denied the allegations and continues to cater to the U.S. government’s demand for selling BTC amid legal disputes with the SEC.