Wow! US Gov among largest Bitcoin hodlers with over $5B in BTC - and Tim Draper?

[Distinctin]

https://cointelegraph.com/news/bitcoin-us-government-largest-bitcoin-hodlers-5b-in-btc-report

The United States government has become one of the largest Bitcoin BTC $28,368 holders, with over 200,000 BTC worth more than $5 billion despite selling a few thousand BTC worth millions earlier this year.

According to a data analysis based on public filings, crypto firm 21.co estimated that the U.S. government still holds 194,188 BTC, estimated to be worth $5.3 billion. The firm noted in its analysis that these are “lower-bound estimations of the U.S. government holdings based on publicly available information.”

So, based on the news, all the Bitcoins they have now come from seizures of illegal activities involving certain individuals or companies. This includes funds from hacked accounts, especially linked to the Bitfinex hack and Silk Road.

There's still more Bitcoin in the balance, as mentioned in the news, so it's likely the government will schedule another auction or maybe just sell it to an exchange once they get the necessary approvals from the relevant government department. There's no fixed time for when they'll do this, but it might have an impact on the market. However, since similar situations have occurred in the past, people might adjust and not see it as a major sell-off. If it does affect the market, it might be a short-term thing.

What's really interesting is that massive Bitcoin auction back in 2014, specifically. As stated below.

The most notable government auction dates back to 2014, when billionaire Tim Draper bought 30,000 BTC from U.S. government auctions in 2014.

So, according to this article from July 2, 2014, Tim Draper made a significant purchase. I'm curious about how much he's made with Bitcoin's current price, so I made a simple computation. If we consider the price back then, around $600 per Bitcoin, and use data from CoinMarketCap:

In July 2014: $600 x 30,000 BTC = $18,000,000
In October 2023: $28,000 x 30,000 BTC = $840,000,000

Based on these numbers, it's safe to say he made a huge amount of money from that purchase, potentially even hitting the $1 billion mark if he sold during the last bull run when Bitcoin hit $60,000.

[DapanasFruit]

I am not surprised to know that the USA government is actually a big holder of Bitcoin and they are actually taken from different personalities and organization who got caught by the law doing illegal acts or business. I am wondering when they would auction a chunk of that holding am sure many could be interested to bid and enjoy the possible profits just like what Tim Draper did in the past. On the other hand, this is telling us that actually the USA government is looking at Bitcoin with real value and something that is not illegal, otherwise maybe they would just destruct them...just like what they could be doing with illegal drugs seized on different operations.

[Poker Player]

If they were a bit smart what they would do is HODL them and keep accumulating as many as they can seize, as I am sure that in the future Bitcoin reserves for the states are going to be like gold reserves today. The only thing is they need a much smaller space than Fort Knox to store large amounts.

[Zlantann]

There's still more Bitcoin in the balance, as mentioned in the news, so it's likely the government will schedule another auction or maybe just sell it to an exchange once they get the necessary approvals from the relevant government department. There's no fixed time for when they'll do this, but it might have an impact on the market. However, since similar situations have occurred in the past, people might adjust and not see it as a major sell-off. If it does affect the market, it might be a short-term thing.

The government always publishes its intention to auction seized coins and people are given the opportunity to bid. The last sale by the US government happened sometime in July this year when about $300 million worth of Bitcoin was moved from two marked government wallets. The price was affected slightly (0.8%) and Bitcoin recovered in a few days.

I am not surprised to know that the USA government is actually a big holder of Bitcoin and they are actually taken from different personalities and organization who got caught by the law doing illegal acts or business. I am wondering when they would auction a chunk of that holding am sure many could be interested to bid and enjoy the possible profits just like what Tim Draper did in the past. On the other hand, this is telling us that actually the USA government is looking at Bitcoin with real value and something that is not illegal, otherwise maybe they would just destruct them...just like what they could be doing with illegal drugs seized on different operations.

The government is also hodling to make profit from Bitcoin. If not they would have sold the seizures a long time ago. I suspect that they will wait till the bull run before another trench will be sold so that the price will increase. It might also be that the reason why Nobuaki Kobayashi, the Mt Gox trustee postponed the deadline of the base repayment to victims was because they also want to make more gains.   

[mk4]

On the other hand, this is telling us that actually the USA government is looking at Bitcoin with real value and something that is not illegal, otherwise maybe they would just destruct them...just like what they could be doing with illegal drugs seized on different operations.

I mean, it would make zero sense for them to simply just send the BTC to a burn address or to just destroy the keys altogether if they can just sell it legally. Comparing it to illegal drugs makes zero sense either because it's literally illegal to buy/sell/use illegal drugs.

[adaseb]

Yeah I remember that auction back in 2014. The auction was blind so you didn’t know what the high bid was. And you could tell there was demand when people were paying more than market rate for the bitcoins.

Many back then thought that Tim was crazy for spending all that money but it obviously was an incredible investment.

Let’s just hope the US Government won’t start dumping the rest of those coins in the near future. I remember last time they sold there was a huge dump on bitcoin.

[davis196]

It's not just the US government holding big amounts of BTC. There were rumors about my country's government holding more than 12 billion USD worth of BTC, which were confiscated from criminals years ago(when the BTC price was way lower). I don't know if those rumors are true, though. What if all the governments, that are holding confiscated BTC decided to sell all their BTC at once? We might be witnessing a 10K-15K Bitcoin price, if such thing happens.
Tim Draper did something smart back in 2014. Should we really discuss his decision here? I doubt that he is a hardcore HODLer, but I might be wrong. There's too much room for speculation, when we are talking about crypto whales and their crypto wealth.

[freedomgo]

Yeah I remember that auction back in 2014. The auction was blind so you didn’t know what the high bid was. And you could tell there was demand when people were paying more than market rate for the bitcoins.

Many back then thought that Tim was crazy for spending all that money but it obviously was an incredible investment.

He took a big gamble investing in that massive pile of Bitcoin. Yeah, it might have looked like a foolish move back then because people hadn't experienced the bull run yet. He could have cashed in during the 2016 bull run when it hit $16k per piece, which I think was the all-time high at that time.

But with this coin, it's anyone's guess. As long as there's no associated address, we can't keep tabs on it. Tim's a billionaire, though, so he probably knows what he's up to. Maybe he sold some to recover his capital and make a little profit, or perhaps he's still holding on to that colossal 30k stash.

Let’s just hope the US Government won’t start dumping the rest of those coins in the near future. I remember last time they sold there was a huge dump on bitcoin.

I don't think they'd dump everything all at once; they'd probably do it gradually if their aim is to liquidate. But you know, the market isn't likely to react negatively to this kind of event since it's not bad news, unless the unexpected happens.

[Wind_FURY]

If they were a bit smart what they would do is HODL them and keep accumulating as many as they can seize, as I am sure that in the future Bitcoin reserves for the states are going to be like gold reserves today. The only thing is they need a much smaller space than Fort Knox to store large amounts.

And as Bitcoin's surge to six digits is highly probable because of the next BRRRRR-Money-Printing + The Halving + ETF approval, therefore increasing the value of those coins in their vaults, then they are now incentivized to become good actors and ensure the success of the network.

U.S. politicians will probably start a debate that Bitcoin mining within some regions of the United States should be encouraged.

Bitcoin, breaking political strongholds?

¯\_(ツ)_/¯

[Husires]

I do not think that the United States will sell 200,000 BTC at once, and even if it does, it will be in an auction, which means that it will be sold at intervals, and there is no time frame that forces them to sell, which is different from what happened, for example, with LUNA, where it was forced to sell 60,000 bitcoins, and the matter Which made the market trend change.
They may be used as news to spread FUD but for years the US has continued to hold bitcoins taken from money laundering operations or raids on drug dealers.

The government will be happy because he bought those currencies and will pay taxes on them.

[Dr.Bitcoin_Strange]

That's a very huge amount of bitcoin, which would really have a great impact on their economy, but if they can keep holding it until the price goes above $300k–$500k, selling the bitcoin now at auction will cause the market to dip, and the government will still utilize the money and might still see the value of the sold coin grow anytime they look back at the old wallet. If they sold all that holding, do they think they might be able to archive such an amount of holding in the near future? IMO, I think they might not be able to get such an amount from hackers unless they will have to buy and reserve, of which now is the opportunity to still hold tight to what they have rather than selling off.

[mirakal]

That's a very huge amount of bitcoin, which would really have a great impact on their economy, but if they can keep holding it until the price goes above $300k–$500k, selling the bitcoin now at auction will cause the market to dip, and the government will still utilize the money and might still see the value of the sold coin grow anytime they look back at the old wallet. If they sold all that holding, do they think they might be able to archive such an amount of holding in the near future? IMO, I think they might not be able to get such an amount from hackers unless they will have to buy and reserve, of which now is the opportunity to still hold tight to what they have rather than selling off.

I doubt the government would consider what they possess as investment funds. Remember that the bitcoins they have likely stem from illegal activities, so their inclination would probably be to sell them once there are no claims and if the court orders it, those assets will become state income. If the US government had a Bitcoin investment program, they'd likely make it public knowledge. After all, the money they manage primarily comes from taxes, so keeping it secret is unconstitutional.

Regarding the seizure of Bitcoin, I don't think it will be auctioned. The market has changed significantly since 2014, with a much larger trading volume, making exchanges very liquid.

As we can see on CoinMarketCap, Binance has a daily trading volume of over $6 billion, while the U.S. holds only $5 billion. They could handle it, but it might cause an instant dip and short-term panic. So, they probably won't do that since it would harm the crypto market they've already regulated. I believe it will be sold on a schedule, gradually rather than all at once.

https://coinmarketcap.com/rankings/exchanges/

[so98nn]

If they were a bit smart what they would do is HODL them and keep accumulating as many as they can seize, as I am sure that in the future Bitcoin reserves for the states are going to be like gold reserves today. The only thing is they need a much smaller space than Fort Knox to store large amounts.

I think it’s fine that they are selling Bitcoin. At least we will have good auction and true investor would go buy it and hodl it even more likely. I hate to say but government treasury is not the place where we should expect Bitcoin getting hodl. There is more concrete reason behind this; government hodling it and selling in the future when BTC price is very high could dilute the market quickly. I mean today’s 5 billion could be worth more than 10-15 billion (assuming) and this will disturb the liquidity and resistance. It’s far better this goes in the wallet of private investors who would just sell small chunks now and then thus keeping the ecosystem clean. It’s not joke man, it’s 1 million plus bitcoins we are talking about.

[Yamane_Keto]

I wonder when they will sell the bitcoins that were seized from chipMixer. Thousands of bitcoins were seized on March 15 and we have not heard any news from them. Such influence will give the United States leverage, as they can classify some currencies as bad because of their connection to some activities, confiscate them and sell them again to make them clean.
I read before about a person who bought Bitcoin from an auction in which coins confiscated from one of the mixers were sold at a price lower than the price of Bitcoin at that time.

[bettercrypto]

I am not surprised to know that the USA government is actually a big holder of Bitcoin and they are actually taken from different personalities and organization who got caught by the law doing illegal acts or business. I am wondering when they would auction a chunk of that holding am sure many could be interested to bid and enjoy the possible profits just like what Tim Draper did in the past. On the other hand, this is telling us that actually the USA government is looking at Bitcoin with real value and something that is not illegal, otherwise maybe they would just destruct them...just like what they could be doing with illegal drugs seized on different operations.

As far as I know, the US is not the only country that has the largest Bitcoin holdings; there are also Russia, Germany, China, South Korea, and Japan. In addition to that, despite the frequent harassment done by the US government on exchanges related to Bitcoin or cryptocurrency, they actually have a lot of Bitcoin holdings.

That is, they seem to want to be the only ones holding Bitcoins in the whole world, something that is impossible and can never happen. And here are some of the countries that also hold Bitcoin:

https://originstamp.com/blog/the-top-10-countries-that-use-crypto-and-bitcoin-the-most/

[Distinctin]

I wonder when they will sell the bitcoins that were seized from chipMixer. Thousands of bitcoins were seized on March 15 and we have not heard any news from them. Such influence will give the United States leverage, as they can classify some currencies as bad because of their connection to some activities, confiscate them and sell them again to make them clean.
I read before about a person who bought Bitcoin from an auction in which coins confiscated from one of the mixers were sold at a price lower than the price of Bitcoin at that time.

That's precisely 1909.4 BTC in total. However, it's not just the USA that has seized the total amount; the government of Germany has also joined the party. It's likely that it was already included in the total amount of Bitcoin they are currently holding, and, just like other bitcoins they've sold on an exchange, the same thing would happen to this batch. It seems like an auction might not be needed anymore, as there are reports that they've sold some of the bitcoins to Coinbase.

https://www.coindesk.com/policy/2023/03/15/germany-and-us-seize-over-46m-crypto-tied-to-chipmixer-investigation-europol/

The authorities took down the platform's infrastructure, seizing four servers, 7 terabytes of data and 1909.4 bitcoins (BTC) ($47.7 million), Europol said on Wednesday.

Just recently this year  ;
U.S. Government Sold $216M of Seized Silk Road Bitcoin This Month

[SquirrelJulietGarden]

This news appears many times in history and it was used to make people panic and shake their weak hands. If you don't have weak hands but have strong hands, don't use leverage, don't trade futures, I am sure you can hold your bitcoin and go through market shakes without big stress and loss.

Bitcoin Supply Visualized.
Bitcoin top 100 rich list.

I used to be very fearful when read such news but with more experience in Bitcoin market, I no longer care about it.
U.S. Attorney Announces Historic $3.36 Billion Cryptocurrency Seizure And Conviction In Connection With Silk Road Dark Web Fraud. Read this news as your entertainment but don't feel panic.

[Lucius]

@Distinctin, aren't you fed up with the bad and fake stories that come from that site?


It seems to me that someone has spread this kind of news right now because they want to create panic when the price rises, and there is no solid evidence that the US government has even 10% of the amount that is being speculated about. Even if by some chance it is true, I don't see a problem with that, Satoshi made Bitcoin for everyone, including the US government.

In July 2014: $600 x 30,000 BTC = $18,000,000
In October 2023: $28,000 x 30,000 BTC = $840,000,000

Based on these numbers, it's safe to say he made a huge amount of money from that purchase, potentially even hitting the $1 billion mark if he sold during the last bull run when Bitcoin hit $60,000.

In case you did a little research and effort, you would have found out that Tim Draper invested the purchased BTC shortly after he bought it. This means that he did not make a direct profit from it, but it is possible that he earned even more through the investment he made.

In the post authored by Vaurum CEO Avish Bhama, the company announced that Draper intends to partner with Vaurum to use the roughly 30,000 BTC to provide bitcoin liquidity in emerging markets.
Draper said:
"With the help of Vaurum and this newly purchased bitcoin, we expect to be able to create new services that can provide liquidity and confidence to markets that have been hamstrung by weak currencies."

[Alpha Marine]

I don't know how true this is, but I do not believe it to be true.
It's no surprise the US government has a certain amount of Bitcoin but I don't believe it's up to that amount.
I'm more concerned to know if those Bitcoins find their way to the real owners.
As the article said, some of those coins are from hackers, those hackers stole people's funds, so does the government return them or even try to return them?

And if this is true, Selling off all those coins at once will mostly affect the price of Bitcoin and I believe that's one of the ways they use to manipulate the market.
Funny how no matter the amount they sell the Bitcoin, they'll still make a profit because it was acquired for free.

[Eternad]

I don't know how true this is, but I do not believe it to be true.
It's no surprise the US government has a certain amount of Bitcoin but I don't believe it's up to that amount.
I'm more concerned to know if those Bitcoins find their way to the real owners.
As the article said, some of those coins are from hackers, those hackers stole people's funds, so does the government return them or even try to return them?

And if this is true, Selling off all those coins at once will mostly affect the price of Bitcoin and I believe that's one of the ways they use to manipulate the market.
Funny how no matter the amount they sell the Bitcoin, they'll still make a profit because it was acquired for free.

You should not be surprised since most of the highest seize amounts of Bitcoin since the beginning came from the US. They probably holding more if they didn’t auction their Bitcoin holdings during the early years when the price still not discovered. There’s still a lot of illegal operations coming from US through ICO scams, Money laundering and other form of services that will contribute to the US stash.

In addition, US still tracking down even those old fraud that happened long time ago and seize their money once they traced it like this one https://www.cnbc.com/2022/11/07/feds-seize-3point36-billion-in-bitcoin-the-second-largest-recovery-so-far.html which is already more than half of the total 5B declared on this topic.