A U.S. government-labeled wallet tied to the 2016 Bitfinex hack moved 12,267.02 BTC worth approximately $1.01 billion on Thursday, alongside $94.15 million in USDT from FTX-linked wallets. The three-day total of government-linked crypto movements now stands at roughly $1.87 billion, though a court-approved restitution process may explain the activity rather than a sale.
Government's Bitcoin Shuffle Breaks the $1 Billion Barrier
Federal wallets linked to the 2016 Bitfinex hack shifted approximately 12,267.02 BTC, worth $1.01 billion, to another address on Thursday, according to Arkham Intelligence data. The move follows Galaxy Research's discovery of $770 million in bitcoin transfers to Coinbase Prime on Tuesday and Wednesday, bringing the three-day bitcoin movement tally to roughly $1.78 billion. The transfers do not establish that any coins have been sold.
Thursday's activity also included a 0.00449 ETH transfer worth approximately $11.53, a $10 USDT test transaction, and a 94.149 million USDT transfer valued at $94.15 million, all tied to wallets linked to the defunct FTX exchange. The USDT went to a Coinbase Prime deposit address. A separate transaction involving 0.00019 BTC, worth approximately $15.57, appeared around the same time.
Bitfinex Restitution Throws a Wrench Into the Sale Narrative
The latest bitcoin movement carries a legal wrinkle. The coins trace back to the 2016 Bitfinex hack, in which approximately 120,000 BTC were stolen from the exchange, and federal authorities subsequently recovered approximately 94,643 BTC tied to the case. In January 2025, a federal court approved returning the recovered assets to Bitfinex, placing the coins in a different category from ordinary government-owned forfeitures.
President Donald Trump's March 2025 executive order established the Strategic Bitcoin Reserve and directed that government-owned bitcoin deposited into the reserve not be sold. Bitcoin that must be returned through restitution, however, is not necessarily eligible for inclusion in that reserve. Returning stolen bitcoin to Bitfinex is therefore not the same as the government unloading its own holdings onto the market.
Still, the blockchain transactions alone cannot confirm that restitution has occurred, and the explanation does not account for why funds from the Lubian mining seizure and the Potapenko-Turogin fraud case moved as well.
Nearly $1.87 Billion in Three Days
Galaxy Research calculated that roughly 71% of the government's bitcoin holdings were associated with the Bitfinex recoveries and the Lubian case, neither of which represents settled government property. Adding Thursday's $1.01 billion bitcoin movement and $94.15 million USDT transfer to the previous $770 million brings the combined value of the reported activity to approximately $1.87 billion.
The central distinction remains ownership, not movement: a transfer involving stolen assets awaiting restitution tells a different story than a government decision to liquidate its bitcoin reserves. The shifts also land at a rough moment for the market — since Sept. 30, around $120 billion has left the crypto economy.
Source: Bitcoin News
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