U.S. Sen. Cynthia Lummis backed off Tuesday after reports emerged that the U.S. Justice Department was likely to transfer and sell seized bitcoins that some lawmakers had expected to be held as national assets.
According to on-chain tracking and multiple news outlets, approximately 57.55 BTC (about $6.3 million) was transferred to a Coinbase Prime account, which later showed the receiving wallet’s balance was 0, meaning the coins had been liquidated.
Senator Lummis sounds the alarm.
According to reports, Senator Cynthia Lummis said she was “deeply concerned” that this appointment was contrary to the president’s previously announced directive.
Executive Order 14233, signed in March 2025, lays out plans to create a U.S. Strategic Bitcoin Reserve and requires seized Bitcoins to be held rather than sold.
Lummis, who chairs the Senate Subcommittee on Digital Assets, questioned why the seized coins were moved to exchange custody accounts rather than held in reserve.
Why is the US government still liquidating Bitcoin? @Potters Have you explicitly mandated that these assets be preserved for strategic Bitcoin reserves? We cannot afford to waste this strategic asset while other countries accumulate Bitcoin. I am deeply concerned about this report. https://t.co/XW5WxsfliA
— Senator Cynthia Lummis (@SenLummis) January 6, 2026
Onchain moves to the point of sale
Blockchain analysts pointed to the move after the address involved in the seizure was traced to Coinbase Prime. According to the report, the Coinbase address ended up with a zero balance immediately after the transfer, which many observers read as an on-chain signal that the asset had been sold.
According to the report, the transfer included digital assets seized from defendants involved in recent criminal cases, and U.S. Marshals moved the coins executing an order from the Department of Justice.
Market reaction and figures
There was little reaction in the market around the time the sale was reported. The price of Bitcoin fell slightly from around $94,760 to near $93,600 at one point, according to a price snapshot cited by the news site.
Although the number of BTC mentioned is a small portion of the overall circulating supply, the policy issues raised and the political backdrop of the National Reserve Plan have put the transaction in the spotlight.
Questions about policy and reserves
Lawmakers and cryptocurrency policy watchers now want clearer answers about when and how seized cryptocurrencies are converted to cash. According to the report, the Department of Justice should explain its decision-making and clarify whether seized bitcoins should be held in strategic reserves under current administration guidance.
Senator Lummis has pushed for formal rules and possible legislation that could prevent similar sales in the future.
So far, public statements from the Justice Department and U.S. Marshals Service have been limited to public records, while Lummis and other reserve advocates have called for transparency.
According to the report, some legal experts argue that the government has discretion over forfeited property, while others say new administrative guidance should change this practice.
Featured image from Pexels, chart from TradingView
editing process for focuses on providing thoroughly researched, accurate, and unbiased content. We adhere to strict sourcing standards and each page undergoes diligent review by our team of top technology experts and seasoned editors. This process ensures the integrity, relevance, and value of the content for readers.
