The U.S. Marshals Service (USMS) converted $6.3 million in forfeited bitcoin into cash, igniting backlash from lawmakers and crypto advocates. Senator Cynthia Lummis sounded the alarm after reports revealed that 57.55353033 BTC — transferred to the USMS on November 3, 2025 — never entered the Strategic Bitcoin Reserve (SBR). Instead, blockchain data from Arkham Intelligence shows the funds moved to a Coinbase Prime address that now holds zero balance, indicating a full sale.
EO 14233 Explicitly Bars Unauthorized Sales of “Government BTC”
As reported by Bitcoin Magazine, Executive Order 14233 mandates that bitcoin obtained through criminal forfeiture be deposited into the SBR, with sales allowed only under narrowly defined conditions. The forfeiture stemmed from charges against Samourai Wallet developers Keonne Rodriguez and William Lonergan Hill under 18 U.S. Code § 982(a)(1) (operating an unlicensed money transmitting business). The statute does not require liquidation, and none of the EO’s exceptions apply. Critics argue the USMS action reflects a Department of Justice culture still uncomfortable holding bitcoin as a strategic asset.
SDNY’s Pattern of Unilateral Enforcement
The Southern District of New York (SDNY) previously ignored Deputy Attorney General Todd Blanche’s April 2025 memo limiting crypto prosecutions, pressing ahead with Samourai and Tornado Cash cases despite FinCEN’s signals that the services did not violate money transmission laws. The bitcoin sale fits the same pattern: prioritizing enforcement over strategic asset management.
Many in the crypto community now question President Trump’s commitment to ending the federal “war on crypto.” His potential pardon of Rodriguez and a DOJ review of the sale could send a strong pro-bitcoin signal, but with the funds already gone and the executive order breached, restoring trust will require more than words.