Blockchain data shows that two wallets belonging to the U.S. Department of Justice moved a large chunk of Bitcoin on Wednesday morning.
The wallets moved 9,825 BTC, amounting to a little over $300 million at the time of writing, in three separate transactions. The price of Bitcoin dropped by 1% after the transactions, falling to an intra-day low of $30,228.
In November 2021, the U.S. government seized over 50,000 BTC from James Zhong, who pled guilty to unlawfully obtaining the coins from hacking the dark web marketplace Silk Road around 10 years ago. At the time, the seized Bitcoin was worth $3.36 billion, marking the largest government cryptocurrency seizure in history.
In March, the U.S. government sold 9,861 BTC and disclosed that it planned to sell the remainder in four separate installments through the course of the year.
“We don’t ever want to flood the market with a tremendous amount, which then could have an effect on the pricing component,” said Jarod Koopman, director of the Internal Revenue Service’s cybercrime unit, in an interview with CNBC.
In the transfers made on Wednesday, the government used the replace by fee function, designed to let Bitcoin users speed up transaction execution during periods of network congestion by replacing an earlier transaction with one that has a higher fee.
So far, the government has executed its Bitcoin sales through Coinbase, an exchange under fire from the U.S. Securities and Exchange Commission (SEC) for allegedly operating an unregistered securities exchange.