Bitcoin News Today: U.S. Government Bitcoin Holdings Plunge 86% to 28,988

The United States Marshals Service (USMS) has recently disclosed that the U.S. government currently holds 28,988 Bitcoin, valued at approximately $3.4 billion. This revelation comes after a Freedom of Information Act (FOIA) request, which uncovered that the previous estimates of the U.S. government's Bitcoin holdings were significantly overstated. Earlier estimates suggested that the U.S. held nearly 200,000 Bitcoin, but the latest disclosure indicates a substantial reduction in the government's crypto assets.

The drop in Bitcoin holdings has sparked debate and concern among policymakers and analysts. Senator Cynthia Lummis has expressed alarm over the potential sale of a significant portion of the U.S. government's Bitcoin reserves. Lummis warned that such actions could hinder the U.S.'s global dominance in the cryptocurrency space. She stated, "I’m alarmed by reports that the U.S. has sold off over 80% of its Bitcoin reserves. If this is true, it would push the U.S. behind in the race to dominate the Bitcoin space."

The recent price rally of Bitcoin, which hit a new all-time high of $123,000, has also reignited discussions about the potential role of Bitcoin in addressing national debt issues. In Bulgaria, the country's Bitcoin holdings, seized from a criminal group in 2018, have grown in value to match nearly 80% of the national debt. Similarly, the U.S. has a massive national debt, currently standing at around $36.2 trillion. Many believe that holding onto Bitcoin reserves could help alleviate this burden, rather than liquidating them prematurely.

The GENIUS Act, supported by Donald Trump, aims to accelerate the integration of digital assets in the U.S. This legislation could put the country in an advantageous position in the global cryptocurrency race. Trump has expressed his positive opinion about the potential of Bitcoin to address key economic challenges, suggesting that the adoption of cryptocurrency may offer a long-awaited competitive edge to the U.S.

The disclosure by the U.S. Marshals Service also highlights the distinction between seized and forfeited property. While the USMS holds 28,988 Bitcoin, other government agencies such as the DEA or FBI could be in possession of additional seized Bitcoin. This clarification underscores the complexity of tracking and managing the U.S. government's cryptocurrency holdings.

The lower-than-expected amount of Bitcoin holdings could be due to multiple asset liquidations over the years, with the U.S. government known for auctioning off seized cryptocurrencies. Notably, large BTC auctions have taken place since 2014, with participants like venture capitalist Tim Draper famously purchasing thousands of BTC. It’s also possible that earlier public estimates were outdated or simply incorrect. Over time, Bitcoin’s rising price may have exaggerated the perceived value of these holdings in public opinion. This new information offers a clearer view of the government’s actual BTC reserve status.

The revelation has stirred debate across social media and crypto circles. Many users are expressing surprise and suspicion about the whereabouts of the missing Bitcoin. Others view this as a bullish signal, suggesting that most of the supply is now back in the hands of the market rather than being held by a government entity. Regardless of the reaction, the new disclosure by the US Marshals Service is a reminder of how transparency and timely updates play a key role in the crypto ecosystem.