As a seasoned crypto investor with over a decade of experience navigating the volatile waters of digital assets, I can confidently say that the recent transfer of Bitcoin by the US government did not result in a sale of their holdings. The on-chain data has proven this beyond doubt, and it’s reassuring to see that transparency remains a priority for the authorities.
It’s been suggested that the U.S. government might have offloaded a substantial amount of its Bitcoin assets after a recent transaction. However, on-chain analysis appears to have dispelled these theories, revealing the true nature of the $2 billion in Bitcoin that was moved.
Did The US Government Sell $2 Billion Worth Of Bitcoin?
According to Arkham Intelligence’s data analysis, instead of selling the approximately 30,000 BTC that the U.S. government recently moved, they divided the $2 billion worth of Bitcoin into two separate wallet addresses, as indicated in a recent post on their platform (originally Twitter).
The authorities transferred approximately 19,800 Bitcoin worth around $1.33 billion to a different one of their Bitcoin wallets (bc1qn), and the rest, about 10,000 Bitcoin valued at roughly $669.35 million, to an address thought to be managed by an institutional custodian.
According to the well-known cryptocurrency account Bitcoin Archive, transferring coins doesn’t equate to selling them. Sometimes, the wallet address involved is merely shifting these coins for safety or investment purposes.
In my analysis, the intent to sell coins is often signaled by moving them to centralized exchanges (CEX), given their high liquidity for such transactions. However, in this scenario, there’s no evidence suggesting a transfer to Coinbase, a platform previously used by the US government for Bitcoin sales. Instead, the $2 billion hasn’t been moved to Coinbase, which could imply different intentions regarding the coins.
It’s important to mention that the U.S. government has consistently been open about its Bitcoin transactions, informing the public each time it sells some of its Bitcoins. The most recent sale, made by the U.S. Marshals Service, occurred in March. Therefore, since then, the U.S. government has not sold any more of its Bitcoins.
Why Is Bitcoin Dumping Then?
It seemed plausible to many in the cryptocurrency community that the U.S. government might have offloaded $2 billion worth of Bitcoin due to its timing with a recent downturn in Bitcoin’s value. However, it’s been confirmed that they haven’t sold any Bitcoin lately, so the decline is likely due to other factors not related to the U.S. government.
One possible explanation for the recent drop in Bitcoin’s value is the escalating conflict in the Middle East, as Iran is believed to be planning retaliation against Israel following the assassination of Hamas leader Ismail Haniyeh in Iran. Additionally, concerns about a potential supply shortage have arisen after Genesis moved 1.5 billion dollars worth of Bitcoin and Ethereum.
Based on Arkham Intelligence’s findings, these transactions are probably being made to reimburse creditors, which could lead to a substantial sell-off of Bitcoin as Genesis pays off its debtors. Additionally, the broader economic landscape has played a role in Bitcoin’s recent slump, with US job growth in July falling short of expectations.
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2024-08-04 00:11