U.S. Crypto Holdings Soar to $23B in Bitcoin and Ethereum

From a recent update by Coin Bureau, the U.S. government is now holding $22.95 billion worth of Bitcoin and $803.26 million of Ethereum. These huge numbers are showing how much crypto has become a part of the government. How it isn’t just about investors and traders anymore

But the story that is behind these holdings is not just simply that the government has bought all this Bitcoin or Ethereum as an investment. But instead it is mostly crypto that was seized from crimes or auctions that happened over the past few years.

How Did the U.S. Get So Much Crypto?

Countries like El Salvador, buys Bitcoin openly for their national reserves. But the U.S. crypto holdings have actually come from a different way.

1. Seized from criminal cases: Mostly it is the FBI who takes Bitcoin, Ethereum, or any other digital assets. From the criminals who were caught in hacking, fraud or any illegal online markets.
2. Court ordered confiscation: Judges sometimes order the crypto to be given uover to the government. As a part of legal agreement or punishments.
3. Not all sold right away – Even though the government has auctioned a lot of Bitcoin before it does not always happen so fast. Sometimes these assets stay in the government wallets for a lot of years before actually being sold.

So this billions of dollars worth of U.S. crypto holdings is basically more like an “inheritance” from crime cases. Instead of the government willingly investing in it

Why These Holdings Matter

Even though the government didn’t actually buy like the other investors, having so much Bitcoin and Ethereum is still a big deal

• Market impact: If the government decides to ever sell big parts of the holdings, prices could change very fast. And so traders always be on the lookout for any government auctions.
• Symbolic importance: These holdings goes to show just how far crypto has made into the important systems. Because ten years ago not a lot of people would have imagined that the government itself would hold so much of Bitcoin.
• Policy questions: Should governments actually hold onto the seized crypto as a reserve asset, or sell it immediately? There is still no clear rule for this.

A Double-Edged Sword

The only issue with this holding is volatility. Because Bitcoin and Ethereum prices can swing very fast. So the government could be holding so many billions today but it can also become billions less tomorrow

This is one of the main reasons that some say it isn’t the best idea to hold onto the crypto for too long. But some others say that having it shows a sign of confidence in digital assets and could become more important later on.

What Happens Next?

Here are a few things to look out for:

• Official statements: Will the U.S. Treasury or the Department of Justice confirm about these numbers or explain them?
• Auctions: If more of the government crypto is put up to be auctioned, it could affect the market supply.
• Policy changes: some other countries are already having crypto in their national reserves plans. This can put pressure on the U.S. to decide if they should keep and use Bitcoin wisely.

Conclusion

Most of these assets have come from crime cases. But the fact that they are now in governments hands shows how far crypto has really come. As of right now, there is only one main question. That is if the U.S. will keep on treating this stash of Bitcoin and Ethereum as just temporary. Or if crypto can one day be more than this and play a bigger part in national finance.