US Government's Seized Bitcoin Stash Soars to $5B: Report

Bitcoin Bonanza

The US Government has accumulated $5 billion worth of Bitcoin through various high-profile operations targeting cybercriminal activities and darknet platforms, as per a recent report from The Wall Street Journal. Agencies like the Justice Department and the Internal Revenue Service are in control of over 200,000 BTC stored in hardware wallets, making the U.S. Govt. one of the largest holders of Bitcoin.

The significant Bitcoin hoard stems from interventions like the Bitfinex cyber attack and the takedown of the Silk Road online drug marketplace in 2013. Operations against individuals involved in cybercrimes, including the cases against Ilya Lichtenstein and Heather Morgan, have also contributed to the government's substantial cryptocurrency holdings.

Legal procedures following the seizure of Bitcoins from illicit sources often involve protracted legal battles, sometimes spanning several years. For instance, the Justice Department took control of Bitfinex assets nearly six years after the cyberattack.

After legal proceedings have been settled, the US Marshals Service takes over the assets, generally disposing of them by asset destruction. While auctions have been a preferred strategy in the past, recent cases have seen the government retain a significant portion of the seized Bitcoins.

However, as per WSJ, the US government does not intend to sell or store the stash for future sale to gain profits.