US Government Moving $40 Million worth of Seized Bitcoin and Ethereum in 2022, Will It Prevent Price Recovery?
The US government monitored $40 million worth of Bitcoin (BTC) and Ethereum (ETH) transfers on Thursday, April 4. This crypto reserve was seized from two Estonian citizens in 2022. This move comes amid a turbulent period for the leading cryptocurrency. Bitcoin price just managed to break above $67,000.
US Government Makes Massive Transfers of Bitcoin and Ethereum
The seized Bitcoin and Ethereum currently in the hands of US authorities have the potential to significantly impact crypto market dynamics. According to arkham Intelligence, the US government made two transfers today for BTC and ETH respectively. The first transfer was 4,567 ETH worth $15.21 million.
Additionally, authorities transferred 374 BTC worth $24.80 million to an unknown wallet. As the market eagerly watches the US government’s next steps, speculation is increasing regarding its potential impact on the price of Bitcoin and Ethereum.
It is estimated that the eventual sale of the crypto reserve seized by the US government could put downward pressure on the price of Bitcoin and Ethereum. Such a significant influx of Bitcoin into the market could trigger selling pressure and accelerate the current decline in prices.
Early Tuesday morning, a wallet affiliated with the US government transferred 30,175 Bitcoins. Considering that the Bitcoin price at that time was around $65,000, the value of this transaction is around $2 billion.
The last confirmed instance of the government selling Bitcoin dates back to March 2023. During this event, they sold 9,861 coins for $216 million. This sale comes after the government seized approximately 50,000 Bitcoins linked to the Silk Road website in late 2022.
Among the latest transfers, approximately 2,000 Bitcoins were sent to a wallet identified by Arkham Intelligence as belonging to crypto exchange Coinbase. The remaining Bitcoin was transferred to a wallet that Arkham marked as government-owned.
Also Read: Bitcoin Short-Term Investors Lost $5.2 Billion Amid BTC Price Crash
Rise in BTC and ETH Prices
After falling over 11% from its recent high of $73,750.07, Bitcoin has recovered significantly. As of press time, the BTC price was $67,534.94, up 2.58%. Meanwhile, BTC’s market cap was $1.32 billion. In contrast, transaction volume decreased by 20.20% to $30.11 billion.
However, the recovery may be short-lived if the US government’s recent transfer of Bitcoin and Ethereum is set for a sell-off. Additionally, Michaël van de Poppe predicted that Bitcoin consolidation will continue and there will not be much of an increase for now. On the contrary, he expects an increase in altcoin prices, which could benefit Ethereum despite possible sell-offs.
At the time of writing, ETH price increased by 1.35% to $3,374.15 and its market cap was $404.99 billion. Ethereum’s transaction volume decreased by 24.82% in the last 24 hours to 13.12 billion dollars.
Also Read: Ethereum L2s May Overtake Main Blockchain, VanEck Reports
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