Just ten days after the U.S. government recommitted $6 billion in military security aid to Ukraine, the U.S. Department of Justice began preparing to liquidate a huge amount of Bitcoin assets.
The Department of Justice has received approval to dispose of 69,370 Bitcoins seized in connection with the infamous Silk Road case, an official confirmed to DB News on January 9. The assets are currently valued at around $6.5 billion.
It is reported that the Ministry of Justice applied for permission to sell these assets on the grounds that the price of Bitcoin fluctuates. When asked about the follow-up actions, a spokesman for the Ministry of Justice responded: "The government will proceed with the next steps based on the judgment of this case."
Once the news broke, Bitcoin dropped more than 2.5% within 24 hours, and as of the time of writing, its price was $94,400.


A significant milestone in the history of Bitcoin: Silk Road.
In October 2013, a young man named Ross Ulbricht was arrested in a library in San Francisco, using the alias 'Dread Pirate Roberts' (DPR). Thus, the once notorious drug and weapon trading website 'Silk Road' was declared defunct. In 2015, Ross Ulbricht was sentenced to life in prison.


This dark web marketplace, which emerged in 2011, initially operated in a 'similar to eBay' model, becoming a trading platform for various illegal goods and services such as drugs, fake documents, and hacking tools. With the anonymous nature of the dark web and Bitcoin as the primary payment method, Silk Road once rapidly developed and was regarded as one of the most well-known and largest illegal markets on the dark web.
From 2012 to 2013, U.S. law enforcement agencies, including the FBI and DEA, began closely monitoring Silk Road and secretly arranged undercover operations. Given the frequent and large-scale transactions on the platform, which involved illegal activities across multiple countries, U.S. law enforcement agencies targeted it as a key focus for crackdown.
During the investigation into Silk Road, the FBI seized approximately 170,000 bitcoins from the platform's servers and Ross Ulbricht's personal digital wallet, marking the largest law enforcement seizure of Bitcoin in history at that time.
When law enforcement arrested Ross Ulbricht, they gained access to related cryptocurrency wallets through the laptops and server information seized at the scene. Since Bitcoin transactions require a private key for transfer, once law enforcement obtained a valid private key, they could transfer the corresponding bitcoins from the suspect's address to an official 'custodial' wallet.
The U.S. government is not selling Bitcoin for the first time.
Since 2014, the U.S. government has auctioned seized bitcoins from the Silk Road case multiple times, and the timing of these auctions and their impact on market prices are worth reviewing.
In June 2014, the U.S. government publicly auctioned bitcoins seized from Silk Road for the first time. The U.S. Marshals Service auctioned approximately 30,000 bitcoins. Bidders included various investment institutions and individuals, with notable investor Tim Draper winning several bids. In subsequent auctions, the government sold the remaining bitcoins in batches.
After the auction, Bitcoin's price around $600 did not experience a 'crash' but instead maintained a stable trend. The auction process highlighted the active bidding by institutional investors, thus reinforcing the 'legitimacy' of Bitcoin to some extent.
In December 2014, a second auction took place, this time auctioning 50,000 bitcoins, nearly double the size of the first auction, and market expectations were similarly negative. However, after the auction concluded, Bitcoin continued to fluctuate in the $300 to $400 range without a prolonged sharp decline.
In March 2015, another 50,000 bitcoins were auctioned, and by this time, Bitcoin had recovered from its previous lows. The prior panic in the market further subsided, and the price stabilized quickly after fluctuating slightly between $280 and $300.
By November 2015, the hundreds of thousands of bitcoins auctioned by the U.S. government by the end of the year did not trigger significant market turbulence. On the contrary, due to the continuous bidding by buyers, these auctions were interpreted as a sign that Bitcoin was gradually gaining more 'legitimate investment' status.
To this day, the U.S. Department of Justice has been approved to liquidate the remaining seized 69,370 BTC (valued at approximately $6.5 billion) from the Silk Road case, with the wallet address labeled as 'bc1qa5' having remained silent for over four years.
Based on past selling experiences, Bitcoin's price may experience a brief panic decline, but from a long-term perspective, given that the U.S. government has often used OTC auction methods, it is unlikely to sell at market prices, and the negative impact on Bitcoin's price should not last too long.


Can Trump's pardon and Bitcoin reserve promise delay the sale?
In May 2024, during his presidential campaign at the Libertarian National Convention in Washington, D.C., Trump promised that if he were re-elected president, he would reduce the sentence of Silk Road founder Ross Ulbricht on his first day in office. On July 28, Trump reiterated during a speech at the Bitcoin 2024 Conference that he would reduce the sentence for Ross Ulbricht if elected president.
On November 14, Ross William Ulbricht posted on X platform for the first time after the U.S. election, stating: 'I sincerely thank everyone who voted for President Trump. I truly believe he will keep his promise and give me a second chance. After enduring over 11 years in darkness, I finally see the light of freedom at the end of the tunnel. Thank you all.'
As of now, the betting topic on PolyMarket regarding 'Will the U.S. government sell Bitcoin before Trump takes office?' has become a hot betting item, with a betting transaction volume of $136,310, and the probability of the U.S. government selling Bitcoin before Trump's inauguration is 22%.


Given that Trump had previously promised to reduce the sentence of Silk Road founder Ross and repeatedly emphasized the intention to make the U.S. the global cryptocurrency capital, expressing a welcoming stance towards cryptocurrencies.
Therefore, most people believe that Ross is likely to receive a commutation or even a pardon. Similarly, it can be seen that in the betting topic on PolyMarket about 'Who will be pardoned within 100 days of Trump's presidency?' Ross has a high probability of being pardoned, with the current probability being 73%.
Due to Trump's Bitcoin reserve promise, if the U.S. government does not sell Bitcoin before January 20, when Trump officially takes office, market speculation suggests that the bitcoins seized from the Silk Road case will not be sold.
How much Bitcoin does the U.S. government actually hold?
According to data from Bitcoin Treasuries, the U.S. government holds 207,189 bitcoins, accounting for 0.987%. Based on the current Bitcoin price, the total value of bitcoins held by the U.S. government amounts to $19,544,018,200.