According to the source, U.S. asset forfeiture statutes require seized cryptocurrency to be liquidated with proceeds deposited into the Department of Justice Assets Forfeiture Fund or the Treasury Forfeiture Fund, not retained as a national reserve, as set out in 28 U.S.C. § 524(c) and 31 U.S.C. § 9703 and summarized by the Congressional Research Service. The U.S. Marshals Service oversees custody and disposal of forfeited digital assets via auctions and contracted service providers, per U.S. Marshals Service guidance and federal procurement records on SAM.gov. The Department of Justice has previously executed staggered BTC disposals, including selling 9,861 BTC from the Silk Road case on March 14, 2023 with additional tranches planned, according to a DOJ court filing in United States v. Zhong filed March 31, 2023 in the Southern District of New York. Traders should monitor on-chain transfers from U.S. government labeled wallets and official disposal announcements for potential supply events, as evidenced by Arkham Intelligence labeling of U.S. government BTC addresses and prior U.S. Marshals Service auction notices.

According to the source, renewed focus on nation-state Bitcoin holdings and wallet movements is relevant for BTC liquidity and price risk in the near term, source: the source. The U.S. Department of Justice has seized large BTC tranches including 69,370 BTC linked to Silk Road (announced Nov 2020) and 50,676 BTC recovered from James Zhong (announced Nov 2022), with subsequent on-chain transfers to custodians prior to disposition tracked by market participants, source: U.S. Department of Justice; Arkham Intelligence. Germany’s Federal Criminal Police Office assumed control of roughly 49,857 BTC from the Movie2k case in 2024 and later transferred portions to exchanges and custodians in mid-2024, which traders monitored as potential supply overhang, source: German Federal Criminal Police Office; Arkham Intelligence. Chinese authorities confiscated 194,775 BTC from the PlusToken scheme per a 2020 court judgment, underscoring China’s status among the largest sovereign BTC holders, source: Yancheng Intermediate People’s Court of Jiangsu Province; Supreme People’s Procuratorate. El Salvador adopted Bitcoin as legal tender in 2021 and disclosed ongoing sovereign accumulation, with President Nayib Bukele publishing a government cold-wallet address in 2024 to evidence holdings, source: Government of El Salvador; President Nayib Bukele. For trading, monitor labeled government wallets and exchange inflows around disposition events—U.S. Marshals Service auctions in prior years created identifiable supply events—using on-chain data and exchange flow metrics, source: U.S. Marshals Service; Arkham Intelligence; Glassnode.