Coinbase Bitcoin Transfer- Is the US Government Ignoring Bitcoin’s True Value?
Coinbase Bitcoin Transfer– The recent decision by the United States government to transfer $1.9 billion worth of Bitcoin to Coinbase has been met with sharp criticism from crypto industry executives and analysts. Many argue that the move was a strategic misstep and could have long-term implications for both the US government and the global Bitcoin market.
US Government Moves $1.9 Billion in Bitcoin to Coinbase
On December 2, the US government moved approximately 19,800 BTC (Bitcoin) to a Coinbase Prime deposit address, which was worth $1.9 billion at the time. This significant transfer prompted reactions from various figures in the cryptocurrency community, including Jason Lowery, a major in the United States Space Force and the author of Softwar: A Novel Theory on Power Projection and the National Strategic Significance of Bitcoin. Lowery strongly criticized the transfer, saying, This is a huge strategic mistake. There is no price where it makes sense for the US to sell any Bitcoin it has under its control.
Criticism of US Government’s Bitcoin Sale: Lack of Understanding of Bitcoin’s Value
According to Lowery, the US government appears to be oblivious to the true potential and importance of Bitcoin as a technology. He pointed out that the move shows a clear lack of understanding about what the government actually owns. He further warned, Remember this post when they inevitably try to justify a new version of EO 6102 to reclaim the Bitcoin they sold off due to their ignorance about the true significance of this technology.
EO 6102 refers to an executive order signed by President Franklin D. Roosevelt in 1933, which prohibited the hoarding of gold by US citizens. Lowery’s reference to this historical order reflects concerns that the government might one day regret selling Bitcoin, much like it did with gold nearly a century ago.
Coinbase CEO and Crypto Experts Join the Debate
Coinbase CEO Brian Armstrong echoed Lowery’s sentiment, agreeing that it would be a mistake for the US government to sell its Bitcoin holdings. Many in the crypto community share this view. “If they are dumb enough to sell (which we all know governments are dumb), then that supply will get eaten up instantly,” said crypto educator Toby Cunningham. Other observers have voiced concerns that the current administration, led by President Joe Biden, may make decisions that could harm the long-term prospects of Bitcoin. One user commented, “Biden will do as much damage as he can before he leaves office.”
While there is no official confirmation on whether the transfer was a sale or simply a custodial action, some analysts believe that these movements could be related to consolidating wallets or updating older addresses. Gabor Gurbacs, strategy adviser at Tether, explained, “There is also a lot we don’t know. It’s not guaranteed they will sell. I haven’t seen any official auction information yet.”
The US government has previously moved large amounts of Bitcoin, with a total of 25,999 BTC worth approximately $2.49 billion transferred to Coinbase so far this year. However, according to Spot On Chain, these transactions could be part of custody actions rather than actual sales. Julio Moreno, Head of Research at CryptoQuant, suggested that only about 10,000 BTC was likely sold in the most recent transfer. The remaining 9,800 BTC was sent to a newly created address, he added.
Bitcoin Market Reaction to US Government Transfer
The Bitcoin market reacted swiftly to the news of the transfer, with the price of the cryptocurrency dropping nearly 3% to around $94,500 at the time of the transfer. However, Bitcoin quickly rebounded, recovering to approximately $96,000 as of writing.
As of now, the US government is believed to hold around 183,850 BTC, which is worth roughly $17.7 billion. These Bitcoin holdings are spread across various known addresses. The transfer of such a large amount has drawn significant attention from both the cryptocurrency community and the broader financial world, highlighting the ongoing debate over the US government’s role in the Bitcoin market.
Potential Implications for Bitcoin’s Future
The US government’s decision to move its Bitcoin holdings has sparked a larger conversation about the future of Bitcoin and its strategic importance. As Lowery pointed out, the government’s lack of understanding about Bitcoin’s true value may lead to missed opportunities down the line. If the government decides to sell off its Bitcoin holdings, it could impact both the cryptocurrency market and the global perception of Bitcoin’s role in the financial system.
In the long run, many believe that Bitcoin’s value will only continue to rise, making it a valuable asset for both individuals and governments to hold onto. The criticism of the US government’s Bitcoin transfer is not just about the sale itself but also about the broader implications of the government’s approach to digital assets.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
Leave a comment