US Government Moves Nearly $2 Billion in Silk Road Bitcoin to Coinbase

The feds on Monday moved nearly $2 billion of seized Bitcoin from shuttered dark web marketplace Silk Road to Coinbase, blockchain data shows. 

Arkham Intelligence flagged the transactions by the United States government. It said that the Bitcoin was from the Silk Road marketplace, and was ultimately moved to America’s biggest digital asset exchange after a brief stop at another Bitcoin wallet. Ultimately, 19,800 BTC—or $1.92 billion worth—was transferred.

Feds shut down the Silk Road online black market back in 2014. The platform was widely used to buy illegal drugs and services—often with cryptocurrencies like Bitcoin. 

Some Bitcoin held by American authorities was seized from James Zhong, who last year pleaded guilty last year to wire fraud.

Zhong manipulated the Silk Road transaction system in 2012 to steal 50,676 Bitcoins. Feds confiscated the stash in 2022, after BTC had rocketed upwards in price. It was one of the biggest Bitcoin seizures in history.

According to Arkham, the huge stash of 19,800 Bitcoin moved Monday went to two different Coinbase wallets at a cost of just $3.34. 

Bitcoin’s price is now down by more than 2% over a 24-hour period, according to CoinGecko. Its price currently stands at $95,250. 

When the government moves large amounts of Bitcoin, it can frighten investors, who speculate that the coins may be up for sale. But Coinbase Prime now has a contract with the U.S. government to manage and dispose of its digital assets, which means that a sale may not be imminent just because Coinbase is involved.

The U.S. government did not immediately respond to Decrypt’s questions, but has in the past sold off seized Bitcoin.

President-elect Donald Trump has pledged to free Silk Road founder Ross Ulbricht upon taking office, after Ublricht has spent more than 11 years behind bars.

“Immense gratitude to everyone who voted for President Trump on my behalf,” an official Ulbricht account on X (formerly known as Twitter), run by his wife, posted last month. “I trust him to honor his pledge and give me a second chance.”

Edited by Andrew Hayward