US Government Transfers $2 Billion in Bitcoin, Defying Trump’s Promises

The US government recently transferred $2 billion in Bitcoin, contradicting former President Donald Trump's assurances about retaining government-held Bitcoin.

This transaction, involving 29,800 Bitcoin from a government wallet linked to Silk Road seizures, took place on July 29. The destination of these funds remains unknown.

Trump’s Pro-Crypto Stance

Trump, during the Bitcoin 2024 conference, promised to retain the government's Bitcoin and proposed policies to make the US a crypto-friendly nation. He also vowed to replace SEC Chair Gary Gensler.

Senator Cynthia Lummis has introduced legislation to classify Bitcoin as a strategic reserve asset, proposing the government acquire 5% of Bitcoin’s total supply.

Criticism from Crypto Community

Galaxy Digital CEO Mike Novogratz labelled the government’s move as "tone deaf," pointing out the inconsistency with Trump’s promises. The transfer is speculated to be linked to an agreement between the US Marshals Service and Coinbase for safeguarding government crypto assets.

Varied Outlooks on Bitcoin

Not all are optimistic about Bitcoin becoming a strategic reserve asset. BlockTower Capital's Ari Paul estimates a 10:1 chance of this outcome within four years.

Government’s Crypto Holdings

The US government remains the largest geopolitical holder of Bitcoin, with over 183,000 BTC valued at approximately $12 billion. It also holds diversified digital assets, including Ethereum, USDT, BNB, and USDC.

US Government portfolio (Source:Arkham Intelligence)

Kiyosaki's Advocacy for Bitcoin

Investor Robert Kiyosaki criticises fiat money, labelling it "fake money," and promotes Bitcoin, silver, and gold as alternatives. He predicts Bitcoin’s price could surge due to the US dollar’s lack of backing and extensive USD printing.

Bitcoin and Gold Breakout Predictions

Raoul Pal, CEO of Global Macro Investor, forecasts significant price breakouts for Bitcoin and gold due to improving macroeconomic conditions. Pal suggests Bitcoin needs to close above $70,000 to confirm this breakout, supported by catalysts like the Nasdaq’s correction, upcoming US elections, and potential weakening of the US dollar.

The US government’s recent Bitcoin transfer contradicts Trump’s pro-crypto promises and has drawn significant criticism from the crypto community, highlighting ongoing debates about Bitcoin’s role in the economy.

The government's actions appear inconsistent with prior pro-crypto promises, raising questions about strategic direction and policy coherence.