Twelve years ago, hardcore bitcoin users asked developers for a “nuclear” coin held in US government wallets, filmed from the Silk Road. They feared that the federal government could either abandon its stash and crush the market, or even worse, wield it as a financial force.
However, in March, the White House quietly ordained some of the new confiscated coins Strategic Bitcoin Reserve. The once-ignited sought censored forks is a source of patriotic pride.
The most expensive yard sale in the history of code
Between 2014 and 2023, the US Former S-Service auctioned around 195,000 BTC for around $366 million. At today’s $105,000 price tag, the lot wins over $20.4 billion. Senator Cynthia Ramis calls the overlooked Upside “deeply annoying,” putting the true opportunity cost north of $21 billion when measured against the cycle highest.
The first sale took place in 2014 when 29,657 BTC was seized from Silk Road Wallet, and 29,657 BTC was settled for about $18.7 million, with coins now worth $3.1 billion. Each subsequent disposal gradually appeared to be smaller than Bitcoin’s expansion market capitalization, and by 2023 the transfer of 9,861 coins had barely kept the price down.
The DOJ received clearance in January to sell 69,370 seized BTC, but since Trump took office, the sale appears to have been postponed after enforcement intervention.
A blacklist fork that never happened
Since October 2013, public tracking has allowed anyone to see the FBI’s new wallet swell with smuggling bitcoin. The BitCointAlk and GitHub panic threads have proposed changes to the protocol to freeze or blacklist addresses. Core maintainers argued that selective censorship would shatter the network’s credibility and warned that blacklisted seized coins would refuse to “break Bitcoin neutrality.”
That decision sets precedent: technical guardianship is apolitical and governments must fight their battles through policies, courts and markets, not through codes.
Pivoting into strategic Bitcoin reserves
The new executive order directs that it will be almost integrated into the Ministry of Finance and the Department of Justice 198,000 BTC They still maintain federal custody and hold them “for national resilience and financial options.”
Authorities frame the reserve as a gold-like hedge, and Capitol Hill’s allies portray it as the dominance of the first appearance of the looming Soblink Lipto Arm Race. The UK has quietly held about 61,000 BTC since a ransomware attack, China has 194,000 BTC, and El Salvador’s Treasury stack is over 6,000 coins.
The impact of the latest sales on the market has been reduced. The reserve coincides with just 1% of the circulation supply, and daily trading volumes easily absorb large flows. It’s not the size of the wallet that drives prices today, it’s the tone of policy. He tweets that Congress forced liquidation and could have knocked Bitcoin 3% in an after-hours transaction last week.
What’s coming next
- Legislative showdown. The House bill calls for restrictions on custody costs for cold wallets and quarterly public audits. Executive Orders are not law because the United States is a constitutional republic where legislative powers are given to Congress rather than administrative bodies.
- custody risk. The office of the Money Secretary must decide whether to outsource key management to private companies or operate internal facilities.
- Global Copy Cat. Analysts hope that at least three G-20 countries will announce similar reserves within 18 months.
For veteran Bitcoiner, the irony is bittersweet. The chain is neutral, the fork will not be shipped, and it is currently wearing a “HODL” badge, when it was once sold at a fire selling price.
The mantra says, “Do you confirm that you don’t trust, you’re dead?”
But we have to ask, is the government stocking up on Bitcoin that has seized from its citizens what Satoshi had envisioned? Is there a conflict of interest if the world’s most powerful Fiat currency printer also owns a huge amount of Bitcoin?
On the road to hyper-bitcoinization, there will ultimately be a showdown between Fiat and Bitcoin. Does Bitcoiner trust the US government to always behave in integrity and do what’s best for Bitcoin?
So far, the “Strategic Bitcoin Reserve” does not include plans to acquire non-seizure coins, but the current president owns memokine, stubcoin, and non-Bitcoin mandatory platforms through his business interests. There is a lot of Pro-Bitcoin rhetoric, but there is little concrete effect compared to the progression of Alt-Coins.
Don’t trust it – and there is little confirmation that Bitcoin (other than the price pump) will benefit from coins held by the government.
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