Bitcoin fell below $59,000, with profit-taking despite positive macroeconomic news. A massive transfer further hindered a quick recovery. Why did cryptocurrencies fall again? The US is involved, and despite reduced fear, excess supply continues.
Silk Road BTC Sale
The US government continues to sell seized assets. According to on-chain data compiled by Arkham, 10,000 BTC worth $600 million was sent to a Coinbase address. As previously reported, the US Department of Justice signed an agreement with Coinbase Prime. The government will work with Coinbase Prime for storing and selling seized assets.
Arkham wrote in its latest post;
“A wallet that received 10,000 BTC from a known US government wallet 2 weeks ago has now sent the assets to a Coinbase Prime address.”
The Silk Road platform was a dark web marketplace and was dismantled after a comprehensive operation. The assets were seized, and the Department of Justice continues to liquidate them as it receives sales permissions.
BTC Sale Fear
Transfers to Coinbase Prime addresses should not be directly interpreted as sales on exchanges. Coinbase, serving ETF issuers and institutional clients, also sells its assets OTC. As long as demand in the ETF channel remains strong, melting thousands of BTC daily is not difficult.
The US government currently holds 203,239 BTC worth $12 billion. The government’s largest three assets include $133 million worth of ETH and $121 million worth of USDT. Mt Gox has largely completed its massive repayments. The bankruptcy committee, which has returned most of the 142,000 BTC to creditors, currently holds 46,164 BTC worth $2.73 billion.
It is known that some creditors did not meet the necessary conditions or died during the repayment process. However, there is no clear information on how much cannot be repaid. In a few months, Germany sold 50,000 BTC, and Mt Gox sold 96,000 BTC, opening the door to sales. However, investor panic was much greater. For now, BTC is hovering close to $60,000, and the nightmare may soon end with FTX pumping dollars into the market.
