TL;DR
- A $10 “test deposit” from a wallet tagged “US Government: FBI” to Coinbase Prime set off selloff alarms, hinting at larger ETH transfers ahead.
- The U.S. now holds 65,156 ETH ($166 million) seized from an NFT scammer, and activity on that stash is fueling speculation of fiat conversions.
- With Coinbase Prime as the go-to institutional gateway, traders are braced for potential volatility if Washington begins off-loading its ETH holdings.
On July 7, blockchain sleuths at Arkham Intelligence spotted an intriguing $10 Ethereum transfer from a wallet labeled “US Government: FBI” to Coinbase Prime. Though tiny in dollar terms, the transaction looked like a standard custody “test deposit” ahead of far larger movements. That small on-chain blip ignited fresh fears of an impending selloff of the federal government’s sizeable ETH holdings.
ARKHAM ALERT: THE US GOVERNMENT JUST DEPOSITED $200K ETH TO COINBASE
A US Government wallet just moved $200K to a Coinbase Prime Deposit, after a $10 test transaction.
This ETH was originally seized from Chase Senecal in October 2022. pic.twitter.com/CFdfN73zyD
— Arkham (@arkham) July 7, 2025
Tiny Test Deposit But Big Market Implications
The initial $10 trial, executed within minutes of larger transfers, followed the industry’s playbook for verifying on-exchange deposits. Arkham’s live alert notified traders that Washington could be preparing a batch of ETH for sale. Historically, institutional platforms like Coinbase Prime serve as off-ramps for major players, so even a micro-transfer from “US Government: FBI” raised eyebrows across crypto circles.
Federal Crypto Stash Hits $166 Million
Beyond the test, U.S. authorities currently control 65,156 ETH, valued at roughly $166 million. This cache traces back to October 2022 seizures from NFT scammer Chase Senecal, alias “Horror (HZ).” The wallet had lain dormant until this week’s flurry of activity, prompting analysts to speculate that the government may convert part of its crypto reserve into fiat, exerting downward pressure on ETH prices.
Coinbase Prime In Focus
Coinbase Prime, tailored for institutional trading and over-the-counter deals, has become the de facto gateway for large-scale digital asset transfers. Its robust custody infrastructure and liquidity pools ensure smooth, discreet transactions. When high-profile wallets move assets there, market participants often brace for imminent sales that can sway price action and sentiment.
Weighing the Impact and Market Response
Despite Ethereum hovering near $2,500, this week’s developments barely budged its price, suggesting investors are either unfazed or caught off guard. Should the government indeed push a sizable portion of its 65,000+ ETH onto the market, even drip-feed sales could trigger volatility.
Regulators have yet to comment, and the Department of Justice offers no public roadmap for its crypto disposition strategy. For now, traders remain on alert, watching Arkham’s alerts and Coinbase Prime’s order books for clues on the next big federal move.
