There are reports of the US Government moving seized Silk Road Bitcoin (BTC) to exchange wallets. But the co-founder of CryptoQuant, Ki Young Ju, believes this may not be the case.
The US government is the biggest Bitcoin whale, with a balance of over 200,000 BTC. But is the government really dumping its bags?
On-Chain Analyst Disagrees
On Wednesday, reports surfaced about the US Government moving Bitcoin after activities in the bc1qzd8 wallet came to light.
On-chain analyst Ki Young Ju strongly believes that bc1qz8 is not a US government wallet and has been mislabelled. He argues that through the transaction patterns, the wallet appears to be an exchange hot wallet, aggregating user deposits.
Arkham Explains Its Reasoning
The blockchain intelligence company Arkham, after being questioned on labeling, explained its reasoning on Twitter. It wrote:
“Today [Wednesday] at 7:36pm, a fresh exchange deposit address received its first transaction, 10.298 BTC from bc1qzd8.
Shortly thereafter, the very same exchange deposit address used by bc1qzd8 also received 115.025 BTC – the exact amount cited in the DOJ announcement, from an address that received said funds on April 28, 2022, the exact date referenced in the announcement.
Afterward, it then received 4.574 BTC, another exact amount in the announcement, from an address which received said funds on June 8, 2022, likewise cited in the announcement.
We believe this association is strong enough to attribute bc1qzd as an additional USG-related wallet.”
But Ki Young Ju further argues it could be the Coinbase hot/cold wallet. He wrote, “I think it’s just Coinbase sent the seized user deposit (10.298 BTC) from their hot or cold wallet.”
As of writing, both the parties have yet to reach a consensus. Moreover, there has been no clarification from either the US government or Coinbase’s official Twitter handle.
In April, BeInCrypto reported that the US Government plans to release 41,500 BTC this year. It sold the first batch on March 14, consisting of nearly 10,000 BTC.
Last year, the US government seized over 50,000 BTC from James Zhong, who stole BTC from the illegal online marketplace Silk Road. Lastly, according to a CryptoQuant dashboard, the US Government holds 204,013 BTC.
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