Over 50,000 Bitcoin (BTC), worth $1 billion, were moved from multiple wallets connected to United States Government law enforcement seizures and transferred to new addresses, with some moved to Coinbase on March 8.
According to data shared by on-chain analytics firm PeckShield, three transfers were made from U.S. law enforcement agency’s wallets. These wallets held nearly 51,000 BTC seized by U.S. agencies from the Silk Road marketplace in November 2021. The confiscated BTC was consolidated into two wallet addresses.
Out of these three transfers, the majority appear to be internal transfers. However, approximately 9,861 BTC was sent to Coinbase. The other two include a 30,000 BTC transfer and a 9,000 BTC transfer.
The Silk Road was an online black market and the first modern darknet market. It was launched in 2011 by its American founder Ross Ulbricht under the pseudonym “Dread Pirate Roberts.“ The marketplace was one of the first to accept Bitcoin payments, helping to popularize crypto use. U.S. law enforcement agencies confiscated multiple items from its founder, including hoards of BTC, which have been auctioned from time to time.
Popular Bitcoin proponent Tim Draper bought nearly 30,000 BTC in 2014 in one of these auctions. Another auction for 50,000 BTC was held in October 2015, where the U.S. Marshals Service auctioned 21 blocks of 2,000 BTC and one block of 2,341 in an online auction.
While only a small portion of the 50,000 BTC was sent to Coinbase, the movement of billions worth of BTC from U.S enforcement agency-linked wallets evoked wild reactions and even wilder theories from Twitter users. One pointed out that if U.S. agencies decided to sell their Silk Road Bitcoin, it would put significant selling pressure on the market. At the same time, a few others questioned the timing of the sale.