According to @zachxbt, the U.S. government says it has custody of roughly 127,000 BTC valued near $14 billion tied to seized wallets. According to @zachxbt, those wallet addresses had been highlighted about two years ago in a Milky Sad report for vulnerable private keys. According to the U.S. Marshals Service, seized Bitcoin has historically been liquidated via public auctions, creating episodic supply that can reach the market. According to the U.S. Department of Justice disclosures in prior cases such as the Silk Road BTC seizures, sales are often executed in tranches rather than all at once, which can affect market liquidity and volatility. According to @zachxbt, the listed addresses provide clear on-chain points to watch, so any movement from these wallets could be a leading indicator for BTC price risk.

According to the source, despite China’s 2021 nationwide ban on crypto trading and mining (source: People’s Bank of China joint notice, Sep 24, 2021; National Development and Reform Commission circular, Sep 24, 2021), Chinese authorities control roughly 194,000 BTC seized from the PlusToken case (source: Jiangsu Yancheng Intermediate People’s Court judgment on PlusToken, 2020), placing China as the No. 2 government holder by publicly attributed wallets, behind the U.S. (source: 21.co Government Bitcoin Holdings dataset, 2024; Arkham Intelligence government-labeled wallets, 2024). For traders, large transfers from government-labeled wallets have coincided with liquidity stress and price drawdowns in prior episodes, including the German government’s BTC disposals in 2024 (source: Kaiko research note on German government BTC sales, 2024) and the U.S. government’s disclosed Silk Road BTC sale in tranches (source: U.S. Department of Justice press release, Mar 31, 2023). Monitoring China- and U.S.-labeled wallet flows on Arkham for unusual outflows is key to assessing near-term BTC volatility, order book depth, and funding rate shifts (source: Arkham Intelligence alerts and dashboards, 2024).