US Government Moves $1 Billion in Bitfinex-Linked Bitcoin, No Sale Seen Yet
Author: Crypffalo Research · 05:54 09/10/2026
A US government-linked wallet moved 12,267 BTC, worth about $1.01 billion, from funds seized in the Bitfinex hack case on Oct 8. The coins have not reached an exchange, but traders are watching closely as bitcoin trades near $81,000.
A wallet that blockchain analytics firm Arkham attributes to the US government moved 12,267 BTC, worth roughly $1.01 billion, to a new unlabeled address at 9:33 a.m. ET on Thursday, Oct 8. The coins are part of the bitcoin seized in connection with the 2016 Bitfinex hack. According to CoinDesk and Decrypt, none of the funds have been deposited to an exchange so far.
Key takeaways
- A US government-linked wallet moved 12,267 BTC (about $1.01 billion) to a fresh address on Oct 8.
- Almost all of it went to a single unlabeled address, with just 0.0012 BTC sent to a second wallet.
- A day earlier, government wallets sent several thousand BTC and about $119 million in USDT to Coinbase Prime deposit addresses.
- Arkham data shows the US government still holds roughly 306,800 BTC, worth close to $25 billion.
- The transfer landed while bitcoin was already under pressure near $81,000.
What happened
Arkham's on-chain data shows the transfer came from a wallet holding funds recovered from the Bitfinex hack. Those coins belong to a stash of roughly 94,000 BTC that US authorities seized in 2022 from Ilya Lichtenstein, who carried out the hack, and his wife Heather Morgan.
Both receiving addresses have already moved the coins onward, according to Arkham. Still, there is no sign so far that any of the bitcoin reached an exchange wallet. CoinDesk described the pattern as more consistent with a custody reshuffle than with preparations for a sale.
A busy week for government wallets
This was not the only move this week. On Oct 7, wallets tied to the FTX/Alameda and Bitfinex seizures sent about $119 million in USDT plus several thousand BTC (CoinDesk put the figure near 3,200 BTC, Decrypt at about 2,574 BTC) to Coinbase Prime deposit addresses. In July, about $288 million in seized crypto was routed to Coinbase Prime through intermediary wallets.
Coinbase Prime serves as both an institutional brokerage and a custodian, so deposits there do not automatically point to selling.
Where the Strategic Bitcoin Reserve fits in
A March 2025 executive order directed forfeited bitcoin into a Strategic Bitcoin Reserve, with the coins intended to be held rather than sold. In August, Treasury Secretary Scott Bessent said the government would look at budget-neutral ways to add to the reserve.
Not every seized coin goes straight into that reserve, though. Some holdings remain tied up in legal proceedings and could be subject to victim restitution or court orders. There is precedent for sales, too: in January 2025, a federal court cleared the sale of about $6.5 billion in bitcoin seized from Silk Road. That is why each government wallet move draws scrutiny from traders.
What it means for crypto markets
On the supply side, 12,267 BTC would be a notable amount to hit the market at once, especially now. Spot bitcoin ETFs just logged a heavy day of outflows, oil prices are elevated and geopolitical tension is weighing on risk appetite.
- Constructive case: If this is simply a custody move, or a step toward consolidating coins into the Strategic Bitcoin Reserve, there is no selling pressure. It could even reinforce the view that Washington plans to hold its bitcoin long term.
- Risk case: If the coins head to exchanges or brokers, markets may price in a potential sale. With liquidity thin, the fear of supply alone can drive sharp swings and trigger liquidations of highly leveraged positions.
Past government transfers have often coincided with short-term price volatility, even when no sale was ultimately confirmed.
What to watch next
- Whether the coins move on to exchanges or Coinbase Prime in the coming days, based on Arkham data.
- Any official comment from the Justice Department or Treasury about these funds.
- Spot bitcoin ETF flows in the next session after the latest outflow.
- US CPI on Oct 14 and the Fed meeting on Oct 27–28; see the economic calendar.
- Leverage and forced selling in derivatives markets via real-time liquidations.
Frequently Asked Questions
Is the US government selling bitcoin?
There is no evidence of that yet. The coins moved to a new wallet, and no exchange deposit has been recorded.
Where did this bitcoin come from?
It is part of roughly 94,000 BTC that US authorities seized in 2022 in connection with the 2016 Bitfinex hack.
How much bitcoin does the US government hold?
About 306,800 BTC, or close to $25 billion at current prices, according to Arkham.
*This content is for information only and is not financial advice.*
Tags: Bitcoin, US Government, Bitfinex, On-chain
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