$2 Billion Silk Road Bitcoin Shifts to Coinbase, Potential Sale Ahead?

A notable transaction, involving 30,175 bitcoins, equivalent to about $2 billion at the present rate of approximately $65,000 per bitcoin, was completed on Tuesday morning.

Arkham Intelligence identified this transfer and associated the recipient wallet with the cryptocurrency exchange Coinbase.

The transaction involves bitcoins seized by the U.S. government in late 2022 in connection with the Silk Road website, representing one of the largest confiscations of bitcoins to date. The government’s most recent confirmed sale took place in March 2023, involving 9,861 bitcoins sold for $216 million.

Bitcoin Transfer Sparks Market

In response to the significant bitcoin transfer, the cryptocurrency experienced a slight decline, dipping below the $65,000 threshold.

Transfer to Coinbase hints at a potential sell-off, prompting investor apprehension.

However, it has since made a modest recovery, currently trading at $65,200, indicating a 4.7% decrease within the last 24 hours.

This movement aligns with the broader CoinDesk 20 Index, which also experienced a similar percentage decrease. Investors have expressed concerns about potential sell pressures that may exert further influence on bitcoin’s price.

Investor Worries, Market Stability

Investors are noticeably wary of the prospect of these bitcoins being offloaded on the open market, a scenario that could exert significant downward pressure on the token’s price.

Market stability is questioned as investors fear sell pressures from seized bitcoins hitting the open market.

This concern arises from past government practices, where seized assets were typically auctioned rather than directly sold on the market.

Conor Ryder, a researcher at crypto markets analysis firm Kaiko, indicated that the transfer to Coinbase likely signals an intent to sell, prompting questions about potential short-term market ramifications.

However, Mark Connors, head of research at digital asset manager 3iq, suggested that the current market dynamics, characterized by reduced leverage and a larger number of investors with substantial holdings, might help mitigate the impact of any selling pressure.

Sajda Parveen
Sajda Parveen
Sajda Praveen is a market expert. She has over 6 years of experience in the field and she shares her expertise with readers. You can reach out to her at [email protected]
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