On Monday, wallets linked to the US government sent 3,940 Bitcoin and 30,014 Ethereum to Coinbase Prime. According to blockchain analytics platform Arkham, the coins passed through several intermediate addresses before settling into exchange accounts on July 13. The combined value of the transfer reached nearly $300 million.
It's one of the largest transfers of government-linked crypto this year. It immediately raised an old question. Is the Trump administration ready to sell seized Bitcoin despite its own pledge to hold it in reserve?
3,940 BTC and 30,014 ETH landed on the exchange in one move
At the exchange rate at the time of the transfer, 3,940 Bitcoin were worth $243.95 million, while 30,014 Ether added another $53.09 million. CoinDesk put the total slightly lower, at $288 million, due to a difference in when the price snapshot was taken as the funds moved.
The coins didn't move directly from old cold-storage wallets. They first passed through several freshly created addresses. That intermediate step is typical for large government transfers. It makes instant tracking harder for outside observers, though the final destination is still public and well known to Arkham's analysts.
By size, July's transfer beat nearly every similar operation this year. The last comparable amount the government moved was back in spring, and that time it involved a completely different asset.
Where the coins came from
Galaxy Research head Alex Thorn, as reported by Cointelegraph, explained the origin of the assets. The Bitcoin was seized from Ryan Farace, known online as "xanaxman", and through the case tied to the defunct exchange BTC-e, which law enforcement has been investigating for more than a decade.
The Ether comes from an entirely different case. Brian Krewson, an Oracle employee, was implicated in a $54 million money laundering and illegal crypto storage scheme. Both sets of assets sat on forfeited wallets under US agency control for years before landing on a commercial exchange.
Trump's Bitcoin reserve order is now in doubt
In March 2025, President Donald Trump signed an executive order stating that Bitcoin seized by the government should join the Strategic Bitcoin Reserve and should not be sold. At the time, the order was billed as a historic step toward treating Bitcoin as a state asset on par with gold.
On paper, a transfer to an exchange looks like a possible step toward breaking that pledge. According to Bloomberg, federal agencies are still arguing over who should control the reserve and under what conditions coins can move between wallets. There's still no clear public protocol for these operations.
Critics of the order argue that without a transparent process for managing the reserve, the no-sell pledge is more of a political statement than a legal obligation. Supporters counter that consolidating wallets ahead of an audit is routine practice for a large portfolio, not preparation for a sale.
At the same time, some lawmakers in Congress are pushing for a separate law that would clearly spell out the procedure for any movement of government-held Bitcoin, rather than leaving it to a presidential order the next administration could cancel with a single signature.
Why a deposit isn't the same as a sale
The deposit alone doesn't confirm a sale. Coinbase Prime offers institutions custody, financing against collateral, and staking, not just trading. Government agencies could have used any of those services without intending to sell right away.
The move could simply reflect wallet consolidation ahead of a future decision rather than a signal that a sale is coming. Similar logic has played out before. When 8.2 Bitcoin tied to the Bitfinex case landed on Coinbase Prime in April, the market barely reacted, and the coins stayed in custody with no sign of a sale.
Not the first transfer like this this year
July's transfer was the largest, but not an isolated case. Government wallets have sent assets to Coinbase Prime several times before, each time tied to a different forfeiture case.
- In April, 8.2 Bitcoin tied to the 2016 Bitfinex hack moved to the exchange.
- In June: a transfer of 98,589 Chainlink tokens seized in the FTX and Alameda Research collapse case.
- In July, the largest transfer to date, 3,940 BTC and 30,014 ETH from the Farace, BTC-e and Krewson cases.
How much crypto is still in US government wallets
Even after July's transfer, government wallets remain among the largest crypto holders in the world. Arkham estimates the total value of those assets at more than $20 billion.
For comparison, the 3,940 BTC from July's transfer make up roughly 1.2% of the government's entire Bitcoin stockpile. Even a full sale of that batch wouldn't change the reserve's structure in any major way, though the psychological effect on the market could outweigh the raw math. The 146 million USDT sitting in the same portfolio draws attention too, since regulators have been paying closer attention lately to how government bodies custody stablecoins.
What it means for the market
Bitcoin traded near $62,600 just as tension flared separately around the conflict in the Strait of Hormuz. Traders were already watching the price over geopolitical risk, so the government wallet activity gave them one more thing to track.
A sale of this size could theoretically add short-term pressure on price, though $297 million is a small slice of BTC's daily trading volume, which routinely runs into the tens of billions of dollars. In past years, the US government has sold portions of seized coins through official auctions, and each time the market absorbed the volume without any notable dip.
The real question here is political, not market-driven. The coming weeks should show whether the funds head toward a sale or settle under Coinbase Prime's custodial control with no further movement.
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