US Government transfers $922 million worth of Bitcoins as crypto market rallies

US Govt’s Bitcoin transfer: The United States government has conducted a transfer of Bitcoin, valued at $922 million, from two cryptocurrency wallets that previously held funds seized from Bitfinex in 2016. This move coincided with Bitcoin surpassing the $60,000 mark for the first time in over two years on February 28, reaching a trading price of $62,507 and marking a 5.52 per cent increase in the preceding 24 hours. Notably, Bitcoin has surged by over 20 per cent in the past week alone.

The transfer started with a test transaction of only 1 Bitcoin on February 28. Subsequently, the US government-initiated wallet executed three more transactions: one worth 2,817 Bitcoin ($172.74 million), another worth 0.01 Bitcoin ($613.35), and a third worth 12,267 Bitcoin ($748.46 million), as reported by Arkham Intelligence.

These funds were seized by the government in 2016 following a cyberattack on Bitfinex, during which approximately 119,754 BTC, now valued at over $7.4 billion, were stolen. The recent transfers come on the heels of Ilya Lichtenstein’court’s appearance in Washington, where he detailed his involvement in one of the largest Bitcoin heists in history. 

Lichtenstein confessed to hacking Bitfinex's systems and orchestrating the theft of over $4.5 billion in Bitcoin. Alongside his wife, Heather Morgan, Lichtenstein was arrested in February 2022, with the US government subsequently seizing $3.6 billion in hacked Bitcoin and an additional $475 million on August 3, 2022.

In August 2023, Lichtenstein and Morgan pleaded guilty to money laundering conspiracy charges related to the Bitfinex hack.