U.S. authorities among the largest holders of Bitcoin

The U.S. government holds 194,188 BTC ($5.3 billion) seized in connection with a number of high-profile court cases. This figure represents the lower bound of the range of possible values, according to 21.co.

Analysts drew on publicly available information such as Silk Road (69,369 BTC) in November 2020, the Bitfinex exchange hack (94,643 BTC) in January 2022 and the theft by hacker James Zhong 51,326 BTC in March of the same year.

The seized coins are stored in hardware wallets, under the custody of the Department of Justice and the Internal Revenue Service.

The government is not rushing to convert Bitcoin into fiat. The legal process from seizure to a final liquidation order can take years. In some cases this has worked to the government’s benefit due to the appreciation of the leading cryptocurrency.

“We are not playing on the market. We mainly follow the timelines of our process,” — said WSJ executive director of the Cyber- and Criminal Investigations division IRS Jarod Koopman.

Nicolas Christin, a computer science professor at Carnegie Mellon University, told the publication that authorities have to carry out thorough checks, “often encountering a lot of bureaucratic red tape.”

In 2014, venture capitalist Tim Draper bought 30,000 BTC from the U.S. government at around $6 per coin. He subsequently lost access to them after the Mt. Gox hack.

In March 2023, authorities sold 9,118 BTC (~$215.7 million) through Coinbase.

Analysts at Arkham Intelligence estimated that the American cryptocurrency exchange holds nearly 1 million BTC, which accounts for about 5% of all bitcoins in circulation.