The U.S. government has moved roughly 9,261 Bitcoin worth $770 million to Coinbase Prime over two days, including thousands of coins linked to criminal seizures and 2,456 BTC from wallets not previously identified as government holdings.
Summary
- 9,261 Bitcoin moved to Coinbase Prime across two days, totaling roughly $770 million in transferred value.
- Nearly half came from Bitfinex hack recoveries, while 2,456 Bitcoin lacked prior government attribution labels.
- Coinbase Prime provides custody and trading, so transfers alone do not prove government selling activity.
- Trump’s reserve order bars sales of reserve Bitcoin but legally allows court-ordered and victim-related transfers.
- Galaxy estimates U.S. government-linked wallets now hold roughly 319,086 Bitcoin across seizure-related addresses on chain.
Galaxy Research reported in its Oct. 8 on-chain analysis that almost half of the transferred Bitcoin came from funds recovered from the 2016 Bitfinex hack. Another portion was traced to previously known Binance-related seizures, while the source of 2,456 BTC had not appeared in the research firm’s earlier government-wallet labels.
Galaxy said the previously unidentified coins “may represent new law enforcement seizures.” The assessment comes from their transfer path into the same Coinbase Prime deposit address used for government assets. No Department of Justice or U.S. Marshals Service statement reviewed for this report has confirmed a new seizure involving the 2,456 BTC.
U.S. government Bitcoin came from several seizure cases
The latest movement combines Bitcoin connected with different federal cases instead of a single $770 million seizure. Galaxy tracked roughly 834 BTC moving on Oct. 6 before a much larger transfer on Oct. 7 brought the two-day total to around 9,261 BTC.
Nearly half was linked to Bitcoin recovered from Ilya Lichtenstein and Heather Morgan following the 2016 Bitfinex hack, according to Galaxy. The Justice Department said Lichtenstein stole 119,754 BTC from Bitfinex and later attempted to launder the funds through exchanges, mixers and other services. Federal agents seized more than 94,000 BTC in 2022 after obtaining private keys to a wallet holding part of the stolen funds.
The Bitfinex coins carry an important legal distinction. In related coverage, crypto.news reported that a federal court ordered more than 94,000 recovered BTC returned to Bitfinex as part of restitution proceedings. The order covered 94,643 BTC and associated forked assets.
Galaxy said the main address containing roughly 94,643 BTC remains unmoved, meaning the latest Bitfinex-linked transfer does not represent the entire recovered balance.
Some of the remaining Bitcoin was linked by Galaxy to known Binance-related seizures. The research firm did not identify the specific enforcement cases behind every coin in its public post, leaving the legal status of individual portions dependent on their respective forfeiture proceedings.
Moving Bitcoin to Coinbase Prime does not confirm a sale
A Coinbase Prime deposit can raise questions about selling because the institutional platform offers trading services, but the destination serves another role for the federal government.
The U.S. Marshals Service selected Coinbase Prime in 2024 to provide custody and advanced trading services for large-cap digital assets managed through the federal asset-forfeiture system. Coinbase said the agency chose its platform following a competitive due-diligence process.
Coinbase Prime currently combines institutional custody, trading, financing and settlement in one platform. Assets arriving there can therefore remain in custody without being sold.
The government has followed a similar pattern before. As crypto.news previously reported, federal wallets moved nearly $297 million in seized Bitcoin and Ether to Coinbase Prime in July. The July transfer included roughly 3,940 BTC worth $244 million and around 30,000 ETH worth $53 million at the time. No immediate Bitcoin liquidation was confirmed from the blockchain transfer alone.
On-chain records can show assets entering a Coinbase-controlled address, but they cannot show whether an internal Coinbase Prime trade subsequently took place. Confirmation of a sale would require further transaction evidence, government disclosure or other records showing disposal of the assets.
Strategic Bitcoin Reserve rules limit government sales
President Donald Trump established the Strategic Bitcoin Reserve through a March 6, 2025 executive order. The order states that Bitcoin deposited into the reserve “shall not be sold” and should remain a U.S. reserve asset.
The rule does not mean every Bitcoin temporarily controlled by a federal agency must remain in government ownership. The order specifically covers qualifying government-owned BTC that has completed forfeiture and is transferred into the reserve.
Separate provisions permit government digital assets to leave federal control when required by a court order or when authorities determine they should be returned to identifiable victims. Assets can also be used for law-enforcement operations, shared with state and local agencies or applied to statutory forfeiture requirements.
The White House’s 2025 digital-assets report later reiterated that Bitcoin in the reserve would generally not be sold while forfeited assets needed for victim compensation and other statutory purposes would continue to be used for those purposes.
For the Bitfinex-related coins, restitution proceedings therefore provide a possible legal reason for moving Bitcoin without violating the reserve’s no-sale policy. A transfer connected with returning stolen assets is different from selling reserve Bitcoin on the market.
Galaxy finds more government Bitcoin than previously labeled
Galaxy’s review produced another update beyond the $770 million transfer. The Coinbase Prime deposit address involved in the movements was activated in December 2025 and has since received approximately 11,567 BTC, according to the firm’s tracking.
Around 6,406 BTC arrived from addresses already labeled as U.S. government wallets. Another 5,160 BTC arrived from wallets that had not previously carried a government label, including 2,456 BTC involved in the latest movement. Galaxy classified those coins as likely government-seized assets because they followed the same transfer route into the federal Coinbase Prime address.
The research firm now estimates government-linked addresses hold approximately 319,086 BTC. Roughly 127,271 BTC is connected to the Prince Group and LuBian case, while approximately 94,643 BTC relates to the Bitfinex recovery. Together, the two groups account for around 71% of Galaxy’s tracked government balance.
The 127,271 BTC figure has official support from a Justice Department forfeiture case. Prosecutors filed a civil action in October 2025 seeking forfeiture of approximately 127,271 BTC linked to Prince Group founder Chen Zhi, saying the assets were already in U.S. government custody. The complaint remains a legal action over alleged criminal proceeds, and DOJ stated that an indictment is an allegation until proven in court.
The distinction between government custody and government ownership remains important when reading the 319,086 BTC estimate. Some seized assets are still subject to forfeiture litigation, court orders or victim restitution, meaning the full tracked balance should not automatically be treated as Bitcoin belonging permanently to the Strategic Bitcoin Reserve.
Crypto.news previously examined the same issue in its coverage of why estimates of U.S. government Bitcoin holdings can be misleading, noting that seized assets and finally forfeited government property have different legal status.
Bitcoin was trading at approximately $82,537 at the latest CoinGecko reading, down about 1.2% over 24 hours. Its daily range stood between $82,312 and $83,713, with 24-hour trading volume around $34.1 billion.
Available blockchain evidence does not establish that the government transfer caused Bitcoin’s decline. The 9,261 BTC movement shows that federal seizure-related assets entered Coinbase Prime custody, while no official disposal notice or confirmed market sale had been published at the time of writing.
