Bitcoin (BTC) faced selling pressure after the U.S. government transferred $240 million worth of cryptocurrency to a Coinbase Prime Address. According to Arkham Intelligence, the 3,940 BTC sent to Coinbase originated from Silk Road vendor and narcotics dealer Banmeet Singh, forfeited during a January trial.
Silk Road, a dark web marketplace founded by Ross Ulbricht in 2011, was shut down by the Federal Bureau of Investigation (FBI) in 2013 following Ulbricht’s arrest. In 2022, U.S. law enforcement confiscated approximately 50,000 BTC, and Silk Road BTC has been seized multiple times since.
On April 2, a wallet associated with U.S. authorities moved $2 billion worth of BTC, prompting speculation about potential sales. Following a transaction on Wednesday, the overall cryptocurrency market experienced a modest decline, including BTC.
In March 2023, the U.S. government sold $216 million worth of BTC using Coinbase’s institutional platform, Coinbase Prime, as its preferred vehicle for liquidation. Despite being the government’s top choice for offloading assets, Coinbase has faced regulatory scrutiny and allegations of illegal business practices.
Under the leadership of Chair Gary Gensler, the Securities and Exchange Commission (SEC) accused Coinbase of operating an unregistered securities exchange and functioning as an unlicensed broker-dealer. Coinbase refuted these claims, arguing in court that the SEC failed to provide clear regulatory guidelines and registration procedures for crypto businesses. Meanwhile, amidst the legal dispute between Coinbase and the SEC, the platform continued to facilitate BTC sales requested by the U.S. government.