US Government Moves $565.87 Million in Seized Bitcoin to Coinbase Prime

Seized Bitcoin Lands on Coinbase Prime

The United States government moved roughly $565.87 million in seized cryptocurrency to Coinbase Prime over a span of several hours on Wednesday, according to on-chain tracking data. The transactions were split into batches rather than a single sweep, and the on-chain record shows the funds resting on the custody platform with no sell-side activity visible so far. The tracking account published a batch-by-batch breakdown as the transactions cleared. The USDT leg went through last in the sequence, after the larger Bitcoin (BTC) batches had already arrived. That final leg carried 94.15 million Tether (USDT), traced to seized funds from bankrupt exchange FTX and its trading arm Alameda Research. Before that, transfers totaling about $471.7 million had already cleared. The first batch contained 3,974 Bitcoin (BTC), worth about $329.95 million, which the on-chain record links to the 2016 Bitfinex hack. A separate transaction carried 657.92 BTC ($54.55 million), 750.19 Wrapped Bitcoin (WBTC) ($62.34 million) and 24.89 million USDT ($24.88 million), all classified as seized FTX and Alameda property. Part of the flow was routed through newly minted wallet addresses before it reached Coinbase Prime.

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The largest single component traces back to August 2016, when about 119,754 Bitcoin (BTC) were stolen from cryptocurrency exchange Bitfinex. US authorities later obtained the private keys of hacker Ilya Lichtenstein and recovered more than 94,000 BTC, a hoard valued at roughly $3.6 billion at the 2022 seizure. Lichtenstein subsequently pleaded guilty to a money laundering conspiracy charge. A move to Coinbase Prime does not by itself imply a sale: in 2024, the US Marshals Service selected Coinbase Prime to provide custody and advanced trading for its large-cap digital asset portfolio, and transfers to the platform can simply reflect asset management. Washington has not disclosed the intended purpose of this week's transactions, nor any connection to prevailing Bitcoin price levels.

Reserve Rules and Restitution Timeline

The movement extended a pattern that had started a day earlier. On Tuesday, government-linked wallets sent 833.6 BTC, about $71.6 million at the time, to Coinbase Prime. On-chain tracing attributed roughly 568.7 Bitcoin (BTC) of that batch to the seized assets of crypto mining service HashFlare and about 264.9 BTC to the Bitfinex case. Aggregate on-chain records put total government digital asset holdings at about $26.68 billion across 618 addresses as of Wednesday, with Bitcoin the dominant position at roughly 319,062 coins, a stock that ranks Washington among the market's largest whales. The holdings have grown largely through forfeiture, not open-market purchases. The policy backdrop matters as much as the plumbing. President Donald Trump signed an executive order in March 2025 establishing a Strategic Bitcoin Reserve and a US Digital Asset Stockpile, under which Bitcoin finally forfeited to the reserve is kept as a US reserve asset rather than sold. The order does not shield every seized coin automatically: assets needed for victim restitution, law enforcement or other legal obligations can be handled outside the reserve. Because reserve coins are meant to be held long term, market attention focuses on the seized coins that fall outside them. The Justice Department has said it intends to use assets forfeited in the HashFlare case for victim compensation, and case materials updated in September state that restitution follows the liquidation of those forfeited assets. Wednesday's haul was nearly eight times the previous day's movement, putting well over $600 million of government coins onto a single custody venue across two days. No auction schedule or sale notice has appeared alongside either transfer.

Our reading is that this looks like custody consolidation, not an imminent sale, but the composition of the moved coins is the part worth watching. Bitcoin covered by the Strategic Bitcoin Reserve is effectively locked away from the market, while the FTX, Alameda and HashFlare assets sit on a restitution track where the Justice Department's own case materials contemplate liquidation. If the seized FTX-linked Bitcoin and the USDT batch follow that path, orderly disposal would be the goal, yet even staged sales of this size would test market depth and could generate measurable slippage along the way. The disclosure to watch next is any government filing that names the purpose of the $565.87 million movement.