The US government moved approximately $1.01 billion in Bitcoin on October 8, raising fears of a major sell-off as the cryptocurrency market continued to decline.
Arkham data shows two outgoing transfers from a wallet holding Bitcoin seized in the Bitfinex hack. Lookonchain traced the larger transfer to two new addresses, holding approximately 6,000 BTC and 6,267 BTC.
Neither destination was identified as an exchange.
Bitcoin Price Falls Amid Government Transfer Fears
Bitcoin was trading near $81,300 on Thursday, down approximately 3% today.
The Bitcoin price chart shows a broader decline already underway. Rising US Treasury yields and oil prices have pressured risk assets, making it difficult to attribute the latest losses directly to the government transfers.
Is the US Government Preparing to Sell?
The origin of the funds offers an important clue.
The Bitcoin came from the 2016 Bitfinex hack, when nearly 120,000 BTC were stolen. Federal investigators recovered more than 94,000 BTC in 2022.
Interestingly, Arkham’s September 2026 research identified a separate recovery of approximately 12,267 BTC, almost exactly today’s transferred amount.
The movement could represent a custody reshuffle or preparation for another transfer.
There is precedent. In December 2024, the government moved $1.92 billion in Bitcoin, initially sending a $100 test payment before transferring 10,000 BTC to Coinbase Prime.
Today’s large transfer has no confirmed exchange destination.
Another explanation involves restitution. In January 2025, US prosecutors argued that seized Bitcoin should be returned to Bitfinex.
Trump’s Strategic Bitcoin Reserve order also prohibits selling Bitcoin deposited into the reserve, while permitting certain court-ordered distributions and victim restitution.
Overall, the $1 billion transfer is real. The evidence currently points to movement between wallets, with no confirmed sale.
Custody changes and possible restitution remain plausible explanations. Further transfers or official disclosures are needed to establish the government’s intentions.
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