U.S. government moves $770M in seized Bitcoin to Coinbase Prime as $1B shifts wallets

U.S. government-linked wallets have moved hundreds of millions of dollars in seized Bitcoin to Coinbase Prime, while another wallet holding Bitcoin recovered from the 2016 Bitfinex hack transferred 12,267 BTC worth approximately $1.01 billion to new addresses. The transactions have drawn attention as traders monitor potential selling pressure during Bitcoin’s market decline.

Blockchain data tracked approximately 9,261 BTC, worth around $770 million, reached Coinbase Prime over October 6 and 7. A separate transfer on October 8 moved the 12,267 BTC associated with the Bitfinex hack to previously unlabeled wallets.

The movements represent a significant change in the location of government-controlled crypto assets. However, the available transaction data does not confirm that the Bitcoin was sold.

Government-linked wallets move Bitcoin to Coinbase Prime

The transfers to Coinbase Prime included Bitcoin connected to several past seizures. Galaxy Research identified funds associated with the Bitfinex hack, Binance-related seizures and previously unidentified government holdings.

Of the 9,261 BTC moved over two days, 8,428 BTC reportedly transferred on October 7, while another 834 BTC moved the previous day. The combined value was approximately $770 million.

An additional 2,456 BTC in the wider flow reportedly came from previously unidentified holdings and reached a government seizure address associated with Coinbase Prime. The origin of these funds has not been fully established publicly.

Coinbase Prime is not a new service provider for the U.S. government. In July 2024, the U.S. Marshals Service selected Coinbase to provide custody and trading services for its large-cap digital assets. The contract supports the agency’s management of cryptocurrency seized and forfeited through federal law enforcement proceedings.

This existing arrangement offers a possible explanation for why seized assets are being transferred to Coinbase Prime. A transfer to a custodian or exchange-linked address does not, by itself, establish that the assets have entered the market for sale.

Another $1 billion in Bitcoin moves from Bitfinex seizure wallet

On October 8, a government-linked wallet holding Bitcoin recovered from the 2016 Bitfinex hack sent 12,267 BTC, worth approximately $1.01 billion, to new, unlabeled addresses.

The 2016 hack resulted in the theft of 119,756 BTC from the Bitfinex exchange. U.S. authorities later recovered a substantial portion of the stolen funds, leading to the seizure and forfeiture of Bitcoin connected to the case.

Unlike the earlier transfers to Coinbase Prime, the October 8 transaction sent the Bitcoin to addresses that were not identified as exchange deposit wallets in the available reports. That distinction makes it particularly important not to treat the movement as a confirmed sale.

Taken together, the reported transfers show more than $1.7 billion in Bitcoin movements across separate transactions. They should not be described as a single $1.5 billion deposit to Coinbase Prime because the transactions involved different destinations and potentially different custody processes.

Strategic Bitcoin Reserve limits government sales

The transfers have also raised questions about how the government is managing seized Bitcoin following the creation of the Strategic Bitcoin Reserve.

In March 2025, President Donald Trump signed an executive order establishing the reserve, which is to be capitalized with Bitcoin finally forfeited to the Treasury Department, subject to specified legal requirements and exceptions. The order states that Bitcoin deposited into the reserve should not be sold and should be maintained as a U.S. reserve asset.

The order also permits certain disposals where required by law, court orders or other specified purposes, including returning assets to identifiable victims of crime and supporting law enforcement operations.

The policy is relevant to the latest transfers, but it does not establish the purpose of each transaction. The public blockchain records show where the assets moved; they do not reveal whether the transfers were for custody consolidation, accounting, reserve administration or another authorized process.

Bitcoin traders watch for potential selling pressure

The scale of the transfers has attracted market attention as Bitcoin has pulled back from levels above $86,000 toward the $82,000 area. Traders are watching government-linked wallets because a confirmed sale of a large Bitcoin holding could add to short-term supply.

However, there is no confirmed evidence that the latest movements represent market sales. Bitcoin transferred to Coinbase Prime may be held in custody or handled through other institutional processes, while Bitcoin sent to new addresses may simply be changing wallets.

The distinction matters because the movement of funds on-chain is not equivalent to a market order. Until a sale is confirmed, the transfers alone cannot establish that the government has increased selling pressure.

For now, the transactions highlight the scale of the U.S. government’s seized crypto holdings and the continued scrutiny surrounding their management. The next meaningful signal will be whether the assets remain in custody, move into the Strategic Bitcoin Reserve or are linked to a confirmed sale or legally authorized disposal.