Bitcoin Seizure: DOJ Takes 129,426 BTC to Strategic Reserve
The US Department of Justice has completed a historic Bitcoin seizure, confiscating 129,426 BTC (approx. $15 billion) linked to Chen Zhi’s alleged “pig butchering” scam. This record crypto asset forfeiture boosts the government’s holdings to over 316,760 BTC.
Under a 2025 executive order, any surplus from the Bitcoin seizure will fund a strategic bitcoin reserve. Authorities must confirm illicit acquisition and settle victim restitution before allocating funds, a process that may span several years.
Security experts warn that managing large-scale cryptocurrency holdings carries significant risks. Hackers often target substantial reserves, demanding robust custody solutions. Blockchain analytics firms have traced the seized coins to a December 2020 hack at China’s Lubian mining firm.
Market participants will watch closely when and how the DOJ moves these assets into the strategic reserve. Gradual releases could reshape long-term Bitcoin supply and affect price stability. The move highlights the DOJ’s increasing role in crypto enforcement and asset recovery.
Neutral
The DOJ’s historic Bitcoin seizure removes a significant 129,426 BTC from circulation, but the coins remain locked in government custody. In the short term, this freeze mitigates sudden supply shocks and has limited immediate market impact. Over time, the creation of a strategic bitcoin reserve under a 2025 executive order signals potential controlled releases, which could support price stability. However, uncertainties around timing, security risks, and regulatory actions keep traders cautious. Taken together, these factors suggest a neutral impact on Bitcoin’s price action.