Why did the U.S. government transfer $71 million in Bitcoin to Coinbase Prime?

The transfer of US$103 million in bitcoin and BNB by U.S. government-linked addresses triggered market sell-off speculation.

According to data from on-chain analyst EmberCN, U.S. government-linked addresses recently transferred approximately US$103 million worth of digital assets, including 833.6 bitcoins (BTC) and 40,285 bitcoins (BNB). Among them, US$71.56 million worth of Bitcoin was transferred to Coinbase Prime, a move that sparked widespread discussions in the market about whether assets were about to enter trading for a sell-off.

Overview of fund flows and positions

The specific details of this transfer are as follows: 833.6 bitcoins (worth approximately US$71.56 million) were sent directly to Coinbase Prime; while 40,285 BNBs (worth approximately US$31.63 million) were redirected through multiple intermediate addresses and finally stayed at addresses that started with "0xBE7" and ended with "81E". The total value of the two transactions is approximately $103 million.

Currently, U.S. government-related addresses still hold digital assets worth approximately US$28 billion, the vast majority of which are bitcoins, totaling approximately 324,000, with a valuation of approximately US$27.7 billion.

Does transferring money to Coinbase Prime mean a sale?

Sending Bitcoin to Coinbase Prime did increase market speculation that it could be sold because of the platform's ability to execute transactions. However, the movement of data along the chain does not in itself confirm that the asset has been sold. Coinbase Prime was selected by the U.S. Marshals Service in July 2024 to custody and execute large digital asset transaction services involving federal asset forfeiture operations. This means that assets entering the platform can be retained as custodial assets or used for trading operations.

Similar questions had arisen in July. At the time, nearly $297 million in seized Bitcoin and Ethereum in government-linked wallets were transferred to Coinbase Prime. The transactions involved include approximately 3,940 bitcoins (worth US$244 million) and approximately 30,000 Ethereum (worth approximately US$53 million). The assets come from seizure cases related to Ryan Farace (nicknamed "Xanaxman") and the closed BTC e Exchange, as well as from another separate federal case. Although blockchain records confirmed that the assets had arrived at Coinbase Prime, they did not establish evidence that officials instructed the platform to liquidate the assets, so no actual sale occurred.

Policy Background: Strategic Bitcoin Reserves and Digital Asset Inventories

Since a series of large-scale transfers in 2024, the federal government's policy on government holding of Bitcoin has changed significantly. In March 2025, President Trump signed an executive order establishing a "strategic bitcoin reserve" and a separate "U.S. digital asset inventory" to manage other cryptocurrencies. According to the executive order, bitcoin that was eventually confiscated and deposited in the "strategic bitcoin reserve" was "not allowed to be sold" and must be held as a reserve asset.

It should be noted that this restriction does not cover all cryptocurrencies in government-linked wallets, regardless of their legal status. The executive order contains provisions for assets subject to court orders, victim compensation, enforcement actions, and other requirements under existing law. Therefore, government-held cryptocurrencies other than Bitcoin (such as BNB) are considered to be managed separately. These assets can enter the "U.S. Digital Asset Inventory" and the Secretary of the Treasury has the authority to determine responsible management strategies in accordance with applicable law.

Given that the current BNB movement path does not directly enter Coinbase Prime, but has undergone multiple jumps, the policy background behind it is different from Bitcoin deposited in strategic Bitcoin reserves.

Historical Data: Impact of Past Government Transfers on Bitcoin Prices

Looking back on history, early government Bitcoin transfers to Coinbase sometimes caused prices to fall in the short term, but this often stems from market concerns about potential sell-offs rather than confirmed sales:

• June 2024:U.S. authorities transferred 3,940 bitcoins (worth approximately $240 million) confiscated from Silk Road seller Banmeet Singh to Coinbase Prime. After the news broke, BTC prices fell by about 2%, as traders considered the possibility that the coins might enter the market.
• August 2024: About 10,000 bitcoins (worth approximately US$594 million) were sent to Coinbase Prime. Bitcoin prices fell 3.6% during this period, although it is worth noting that the downward trend began before seized Silk Road funds reached Coinbase Prime.
• July 2024: A larger transfer occurred, transferring approximately US$2 billion in Bitcoin from the government wallet and splitting the funds into two addresses. Arkham Intelligence believed at the time that 10,000 of those bitcoins were funds deposited in institutional custody or service providers. Bitcoin subsequently reportedly fell by about 1%.
• December 2024: Nearly 20,000 bitcoins (worth approximately US$1.92 billion) were transferred from another government-linked address. The coins were sent to a new address and then allocated to two wallets holding approximately 10,000 and 9,800 bitcoins.

Government authorities have indeed sold seized bitcoins in the past. For example, in March 2023, officials sold 9,861 bitcoins related to Silk Road for a transaction price of approximately US$216 million. The disposal was later disclosed through court documents, confirming that the coins were indeed sold and not just relying on speculation that they moved on the chain.

All of the above 2024 transactions occurred before an executive order in March 2025 established a strategic bitcoin reserve and prohibited the sale of bitcoins deposited in it. Recent continuing changes indicate that it is difficult to clarify the purpose of Coinbase Prime transfers based on blockchain data alone. For example, in June this year, government wallets moved nearly $984,000 worth of seized FTX and Alameda assets, of which at least $768,000 reached Coinbase Prime. Arkham pointed out that the assets are intended to be used in the FTX bankruptcy estate to help repay creditors.

As of now, no federal agency has announced plans to sell related to the latest 833.6 bitcoin transfers. EmberCN's data only confirms that bitcoins have reached Coinbase Prime, and determining whether the coins have been sold requires further transaction data or confirmation from the government and its service providers.