US Government Transfers Nearly $4M Worth of Seized Bitcoins to Coinbase

The US government transferred 58.742 BTC – worth nearly $4 million, to crypto exchange Coinbase on Monday.

According to the latest data compiled by blockchain analytics firm Arkham Intelligence, the transfer came from an address labeled “US Government: Ryan Farace Seized Funds,” identified on the blockchain as 3B2jEBZi8fJWGEDrh6Pe7hDMaJ6iGfFtaU.

These funds were confiscated three years ago from a Maryland resident, Ryan Farace, who was convicted in 2018 for selling Alprazolam, the generic form of Xanax, over the dark web.

Subsequently, Ryan’s father, Joseph Farace, was also convicted for laundering and trafficking bitcoin proceeds intended for federal forfeiture. The Department of Justice eventually recovered 2,933 BTC from the father-son pair and announced plans to liquidate the holdings in January of this year.

While Ryan Farace was sentenced to 54 months, his father received 19 months for the same charge.

The potential liquidation of funds through Coinbase is unlikely to significantly impact the spot price, in contrast to the recent large sale of BTC by Germany’s Saxony state.

On June 19, Germany’s Saxony state began offloading confiscated bitcoins it had seized from the movie piracy website movie2k. By July 12th, it had sold its entire stash of nearly 50,000 BTC and generated almost $2.87 billion in the process. This hasty sale yielded a profit of over $740 million compared to its acquisition cost of $2.13 billion in January.

However, the selling spree put tremendous bearish pressure on the market and even resulted in bitcoin’s price briefly plunging below $55,000.

At the time of writing, BTC was trading at around $67,000, where it has been standing for most of the last week or so.