US gov has to follow a ‘strict process’ before unloading $6.5B of bitcoin

Asset Reality’s Aidan Larkin explains how the US government offloads bitcoin

article-image

MaxFrost/Shutterstock modified by Blockworks

share


This is a segment from the Empire newsletter. To read full editions, subscribe.


Don’t panic. 

That’s the gist of the message from Asset Reality’s Aidan Larkin on this week’s Empire Roundup. Jason Yanowitz and Santiago Santos specifically asked him about all that US government bitcoin.

Basically, the recent court approval is par for the course for any civil forfeiture. And, no, it doesn’t mean that the US is immediately hitting the sell button.

 ”There’s a very strict process that has to get followed,” Larkin said. 

“ At some point in the future, it’ll just go through the normal government processes. There will be a civil forfeiture application hearing. They will get their green light and then it will fall into the normal Marshals process and public domain,” he added. Asset Reality (which is a firm both Santos and Yanowitz invested in) helps governments manage seized assets, so Larkin is not just some armchair expert. 

From here, we’ll eventually see Coinbase move the bitcoin onchain before it’s sold off. 

Blaming the price action on the possibility of trying to time when the gov is going to sell some of its stash isn’t the right move, Larkin said. Instead, when you see that type of selling pressure, then it’s more than likely due to folks speculating and selling themselves. 

And now you know. 

Loading Tweet..

So how did we get here? Well, a Nevada company called Battle Born Investments initially sought to prevent the US from offloading the bitcoin. However, a judge in California overruled their motion earlier this week, which allows the US to move on with the civil forfeiture, as Larkin noted. 

The likelihood of the bitcoin in question being funneled into a potential bitcoin strategic reserve is not very high either, so don’t get your hopes up. 

(ICYMI: This summer, Trump said he planned to make it so that the US holds all its current bitcoin and uses it as a strategic reserve.)

To sum it up: Any bitcoin to be sold must first go through older processes. We’re talking pre-crypto processes designed for seized assets such as gold. 

Then, there could be a slew of agreements to be made, from using the generated funds to make victims whole to asset sharing agreements with other governments. It’s pretty complicated. 

Besides, as Larkin noted, would the US really want to use bitcoin linked to crimes for its reserve stash? Seems unlikely.

When dealing with the government, always assume there’s going to be a lot of bureaucratic red tape. What seems cut and dry probably isn’t. 

Instead, Yanowitz thinks we could see — if we get a reserve, mind you — the government buying up bitcoin mined on US soil to stash away. And, honestly, that sounds a lot more interesting than bitcoin simply linked to Silk Road.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates (1).jpg

Research

Jupiter has emerged as the undisputed liquidity backbone of Solana, commanding over 90% of spot DEX aggregation and 80% of perp trading volume. But behind the numbers lies a far more ambitious play: a cross-chain, vertically integrated super-app spanning swaps, synthetics, NFTs, memecoins, and launchpads. This report explores Jupiter’s rapid rise, the monetization upgrades reshaping its revenue profile, and the risks that could unwind its dominance, from token dilution to competition. With annualized revenues nearing $300M, the upside is undeniable, if it can navigate the turbulence.

article-image

Zora’s announcement that its token is for “fun only” sparked a debate about the need for such tokens

article-image

In recent weeks, Helium has hit new all-time highs while passing major protocol milestones

article-image

Financial advisers in a January survey said equity ETFs were their top choice for gaining crypto exposure in 2025

article-image

“Why put a target out there that’s really speculative, not knowing exactly where this environment is going to go?” CarMax CEO Bill Nash said

article-image

While the head of Base may support legal sex work, Coinbase policies prohibit said workers from using its exchange.

article-image

EVM bottlenecks fundamentally hold back Ethereum’s scalability