An important development has emerged in the ongoing saga surrounding the defunct online criminal marketplace Silk Road. on the chain data It indicates that there is a huge amount of market-related money on the move, with more than 9,000 bitcoins (BTC) recently transferred from two addresses linked to the Silk Road. the addresses In question that the US Department of Justice has seized it.
BTC US government going to move?
The latest money transfer follows the seizure of more than 50,000 bitcoins from James Zhong, who recently pleaded guilty to online fraud for illegally obtaining bitcoins from the Silk Road dark web market in 2012. law enforcement took over Bitcoin from Zhong’s home in Gainesville, Georgia, in November 2021, in what was the largest cryptocurrency seizure in US Department of Justice history.
According to court filings, Zhong set up a series of Silk Road accounts to hide his identity, triggering more than 140 transactions in quick succession to trick Silk Road’s withdrawal processing system into releasing nearly 50,000 BTC in his accounts.
He then transferred the Bitcoin to separate addresses under his control, all in a way designed to prevent discovery and obfuscation of the source of the Bitcoin.
Zhong’s possession of 50,000 Bitcoin resulted in him receiving 50,000 Bitcoin Cash in the form of a split hard fork in August 2017. He then exchanged all of the BCH crime proceeds for additional Bitcoin, which amounted to approximately 3,500 Bitcoin in additional crime proceeds. By the last quarter of 2017, Zhong owned approximately 53,500 bitcoins in total crime proceeds.
In March 2022, Zhong began voluntarily handing over the extra Bitcoin to the government that he had access to and did not squander. In total, he surrendered an additional 1,004,14621,836 bitcoins.
The US government had previously sold 9,800 bitcoins in March 2022, with plans to sell another 41,500 bitcoins. However, the recent transfer of more than 9,000 bitcoins from Silk Road-related addresses has raised questions about the fate of the remaining seized bitcoins.
Is Bitcoin bull in danger?
As previously mentioned before newsThe US government plans to sell the remaining 41,500 BTC in connection with the Silk Road issue. Since then, the US government has been selling confiscated BTC in batches, and the upcoming sale of 41,500 BTC could have a huge impact on the cryptocurrency market.
If there is no demand for Bitcoin when the US government sells what is left of the BTC, this could lead to a drop in the price of Bitcoin. This is because a sudden influx of BTC into the market could lead to an oversupply, which could overwhelm the existing demand. As a result, the market price of BTC could drop, leading to a temporary drop in the value of the cryptocurrency.
However, it is important to note that the effect of the government selling bitcoin on the market is not entirely predictable. If buyers are willing to buy BTC at the quoted price, the market may not experience much volatility.
On the other hand, if the demand for BTC is strong and buyers are willing to pay a premium for the forfeited BTC, then selling could drive up the BTC price.
Despite these concerns, bitcoin appears to be regaining bullish momentum, in an attempt to breach the $31,000 mark. If BTC can consolidate above this resistance level, it could indicate a possible bullish trend in the value of the cryptocurrency.
Currently, BTC is trading at $30,700, which is the same price level it was at in the 24-hour time frame as of July 11. BTC’s floor of support at $30,000 has been holding up nicely, despite the weakness in the price action.
This could act as a threshold for the Bitcoin bulls in case another attempt to break through the upper resistance lines fails in the short term.
Featured image from Unsplash, chart from TradingView.com