Bitcoin

<h2 id="header-0">Key Facts</h2>
<ul>
 <li>US government wallets moved about 17,700 BTC to Coinbase Prime this week, the largest estimated weekly drop in their holdings since November 2015, K33 found.</li>
 <li>Bitcoin fell to $80,337 on Thursday and traded at $82,792 as of 10:12 a.m. ET Friday, up 0.6% over 24 hours, CoinMarketCap data show.</li>
 <li>K33 expects little government selling, but Bitfinex, which has claimed about 109,700 BTC in court, may sell up to 87,782 BTC once it receives them.</li>
</ul>
The US government moved about 17,700 Bitcoin (<a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/currencies/bitcoin/">BTC</a>) to Coinbase Prime this week, its largest weekly drawdown since the final Silk Road auction in 2015, by K33's estimate. The next test is a court claim by Bitfinex, which has pledged to sell much of what it gets back.
Bitcoin fell to about $80,300 on Thursday, the day the largest lot moved, before recovering to near $82,800 on Friday. Most of the coins went into the US Marshals' custody account, K33 head of research Vetle Lunde found. Only about 1,200 BTC from victim cases looks headed for sale. The larger supply sits with Bitfinex, which has claimed about 109,700 BTC in court. Lunde estimates that as much as 87,782 BTC could be sold in the 18 months after the exchange receives its coins.
Lunde read the week's flows as a custody step.
"A transfer from a government wallet to Coinbase Prime does not mean a sale," Lunde <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/VetleLunde/status/2108522796103967094">wrote</a> on X.
<h2 id="header-1">What Did the Government Move? 17.7K BTC to Coinbase Prime</h2>
Government <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/glossary/wallet">wallets</a> began sending coins to Coinbase Prime on Tuesday, Galaxy Research <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/glxyresearch/status/2107983859421946264">found</a>. Wednesday was the largest outflow day from labelled government addresses since December 2024.
On Thursday, a wallet holding coins recovered from the 2016 Bitfinex hack sent the week's largest lot, Galaxy's tracker <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/glxyresearch/status/2108194394012889264">showed</a>.
Coinbase Prime is both the Marshals' trading partner and its custodian, so a deposit there can mean a sale or simply storage. A March 2025 executive order bars selling forfeited Bitcoin placed in the Strategic Bitcoin Reserve.<tweet-embed url="https://x.com/glxyresearch/status/2107983881618235419"></tweet-embed>
<h2 id="header-2">Is Washington Selling? Mostly Custody Moves, K33 Says</h2>
The main deposit address took in coins from several unrelated cases, which points to the Marshals consolidating their holdings, Lunde wrote. About 16,500 of the coins belong to the Bitfinex case and are expected to be returned to the exchange in kind.
The coins from the FTX and HashFlare cases may be sold to pay victims in cash. They are not fully forfeited, so the reserve's no-sell rule does not apply, he wrote.
Galaxy Research also found a longer pattern in the government's records.
"Since 2020, seizures have far outrun sales," the firm <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/glxyresearch/status/2107983881618235419">wrote</a> on X.
<h2 id="header-3">Who Sold Instead? Newer Holders, Many at a Loss</h2>
Recent buyers were among the sellers. Short-term holders sent 29,100 BTC to <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/glossary/exchange">exchanges</a> at a loss in 24 hours, the most since June, CryptoQuant <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/cryptoquant_com/status/2108467754139615495">found</a>. The firm said the government transfers set off the pullback in a market already sitting on large unrealized profits.
Other pressure landed the same day. Fed Governor Christopher Waller <a target="_blank" rel="noopener noreferrer nofollow" href="https://www.axios.com/2026/10/08/interest-rate-hikes-fed-waller">said</a> he anticipates further <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/glossary/interest-rates">rate</a> hikes, and US spot Bitcoin funds recorded a second day of <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/article/bitcoin-below-82k-blackrock-ibit-outflow">outflows</a>. Leveraged long bets were also forced shut as <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/glossary/liquidation">liquidations</a> climbed, CoinGlass data show.
<h2 id="header-4">Where Is the Real Supply Risk? Bitfinex's Court Claim</h2>
Lunde's estimate rests on Bitfinex's court claim, which he traced to an April 2025 court opinion. The exchange has pledged to use 80% of recovered funds to buy back and burn its UNUS SED LEO (<a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/currencies/unus-sed-leo/">LEO</a>) <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/glossary/token">token</a> within 18 months.
Claims processes typically take one to three years, and this one is about 20 months in, he wrote. Two lots moved this week were among the coins Bitfinex's expert traced, which Lunde read as a sign the claims process may be moving forward.<tweet-embed url="https://x.com/glxyresearch/status/2107983889134449128"></tweet-embed>
The 18-month clock starts only once Bitfinex receives the coins.
"The key level to watch is $74.6K, the Short-Term Holder Realized Price. Holding above it keeps the early bull-market structure intact. Losing it increases the risk of a deeper correction," CryptoQuant <a target="_blank" rel="noopener noreferrer nofollow" href="https://x.com/cryptoquant_com/status/2108467939431379271">wrote</a> on X.
Further Reading: <a target="_blank" rel="noopener noreferrer nofollow" href="https://coinmarketcap.com/academy/article/starknet-price-quantum-resistant-ethereum">Starknet Price Climbs 26% as It Floats Quantum-Resistant Split From Ethereum</a>

Bitcoin Price Steadies Above $82K as US Gov't Coins Move Into Custody

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