U.S. Government Misses Out on $6.3 Billion in Bitcoin Profits, Remains Major BTC Holder
Summary:
The U.S. government holds more than $7.2 billion in Bitcoin, according to data from Glassnode, having confiscated a large amount through legal proceedings. However, Jameson Lopp, co-founder of Bitcoin custody firm Casa, suggests the government has missed out on over $6.3 billion in potential gains from selling its Bitcoin holdings prematurely. Despite these missed opportunities, the U.S. Department of Justice remains the largest institutional holder of Bitcoin, possessing more than major corporations like MicroStrategy. Furthermore, billionaire Tim Draper has criticized the U.S. government for allegedly curtailing the growth of cryptocurrencies.
As of October 31, the U.S. government holds a net total of 210,429 Bitcoins (BTC), with a value in excess of $7.2 billion. This is according to data from the on-chain analytics company Glassnode. Over the years, the U.S. Department of Justice (DoJ) and the Internal Revenue Service (IRS) have confiscated a significant quantity of BTC through legal proceedings. However, only a fraction of these confiscated Bitcoins have been subsequently auctioned off.
In a curious twist, purchasers of these auctioned Bitcoins have enjoyed significant profits, while the DoJ has perhaps inadvertently missed opportunities for profit by selling too early. Jameson Lopp, co-creator of Bitcoin custody company Casa, has compiled data showing that the government has missed out on potential gains amounting to upwards of $6.3 billion from its sell-off of 195,092 Bitcoins.
The DoJ is currently the largest institutional holder of Bitcoin, with its holdings surpassing even those of major corporations such as MicroStrategy, who currently holds 158,245 Bitcoins, equivalent to about $5.43 billion according to Bitcoin Treasuries.
Glassnode's data also highlights how the DoJ's Bitcoin stash has increased in tandem with announcements of Bitcoin confiscations. For instance, their inventory grew by nearly 100,000 Bitcoins in early 2022, following legal action against individuals accused of laundering money from the 2016 Bitfinex crypto exchange hack.
Tim Draper, billionaire and one of the early bidders on the government's Bitcoin auctions, recently alleged that the U.S. government is discouraging the growth of cryptocurrencies. Despite predicting a BTC price of $250,000 for this year, Draper has criticized policy shortcomings, accusing governmental policies of "killing the golden goose of Silicon Valley." He contends that regulations are stifling the innovative spirit.
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Published At
10/31/2023 3:29:21 PM
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