U.S. Bitcoin Liquidation Won’t Shake Markets, Experts Say

The potential sale of billions in Bitcoin by the U.S. government isn’t sparking concern among experts, according to Asset Reality CEO Aidan Larkin.

Speaking on the Empire Roundup podcast, Larkin reassured listeners that any liquidation of seized Bitcoin would be carefully managed through a structured process, minimizing the likelihood of market turbulence.

The Bitcoin in question, largely tied to past criminal investigations such as the Silk Road case, was recently cleared for forfeiture in court. However, this ruling does not mean an immediate sale is imminent. Larkin explained that the government must first complete a civil forfeiture process before transferring the assets to the U.S. Marshals Service for orderly liquidation. This deliberate approach ensures transparency and avoids abrupt disruptions in the market.

Larkin’s insights carry significant weight, given his expertise in managing confiscated assets for governments. He also highlighted that any sale would likely involve moving the Bitcoin to a platform like Coinbase, a development sure to attract attention from the crypto community. Still, Larkin emphasized that much of the market reaction to such news often stems from speculation by traders rather than direct government actions.

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While some have floated the idea of the U.S. creating a Bitcoin reserve, including a proposal from Donald Trump, Larkin dismissed this as unlikely. He pointed out the complications of using seized Bitcoin for strategic purposes, given its origins in criminal cases. Instead, a more plausible scenario suggested by co-host Jason Yanowitz involves the government acquiring Bitcoin mined within the U.S. This approach, Yanowitz argued, would provide a more ethical and practical method for establishing a reserve if one were ever considered.

Alexander Stefanov