Scott Johnsson, a general partner and general counsel at Van Buren Capital, believes the U.S. government’s recent move to transfer Bitcoin linked to the defunct Silk Road online marketplace to a Coinbase address means the funds are on the verge of being sold.
In an Aug. 16 post on X, the financial lawyer suggested that there was a high possibility the U.S. Marshal Service, the agency mandated to dispose of digital assets seized and forfeited from criminal activity, was likely in the process of selling Bitcoin (BTC) seized from the Silk Road marketplace.
Johnsson was responding to a post from Founders Fund co-founder Joey Krug, who had shared data from Bitcoin explorer Tokenview, showing more than 19,000 BTC that had been moved into a Coinbase account. The lawyer seemed to agree with Krug’s assertion that the coins were the remaining Silk Road stash yet to be sold.
Johnsson’s assertion comes soon after the U.S. government transferred about $594 million worth of Bitcoin seized from Silk Road to a Coinbase Prime address, according to data from Arkham Intelligence.
Silk Road founder Ross William Ulbricht was arrested shortly after the marketplace was shut down in 2013.
The original site’s administrators then launched a new website, Silk Road 2.0, but a special police task force also closed it down in 2014.
According to Johnsson, the USMS has been transferring assets to the custodial address as per an established servicing agreement with Coinbase that was made in June.
The lawyer claimed that the agreement requires that USMS assets remain completely segregated, with any transfers to commingled exchange addresses like Coinbase Prime meaning that the agency was likely preparing to sell the BTC assets.
In his post, the lawyer shared snapshots of the U.S. Department of Justice’s Office of Inspector General report, which showed that the USMS’s Complex Assets Unit was required to liquidate assets within five business days after they had been forfeited.
Johnsson anticipates the official confirmation of the sale could come with the DOJ’s asset forfeiture program fiscal year 2024 report, due in January 2025.
Interestingly, he noted that the USMS’s move to dispose of the Silk Road Bitcoin came after former U.S. President and Republican presidential candidate Donald Trump’s recent speech in which he promised not to sell any of the Bitcoin held by the government if he were to win a second term.
The U.S. reportedly holds about $12 billion in BTC, making it the largest government holder of the cryptocurrency, which currently has a market cap of $1.17 trillion.