Crypto Czar Spotlights $17B Loss In Bitcoin By US Government

The White House’s AI and Crypto Czar, David Sacks, revealed how the U.S. government seized Bitcoin (BTC) too early. In a recent X post, he pointed out that if officials had held onto the digital gold for a long period, it would be worth billions of dollars at the current price.

This news has caused an uproar in the crypto community. With Bitcoin’s price showing positive growth, many question why the government did not hold onto these assets.

U.S. Sold Bitcoin Reserves Too Early

In his post, David Sacks said the U.S. government has sold off nearly 195,000 Bitcoin over the past ten years for just $366 million. He asserted that this decision had cost taxpayers a fortune, as those same Bitcoins would now be worth over $17 billion. 

Notably, most of the government’s Bitcoin came from crackdowns on criminal operations, including the infamous Silk Road case. In 2013, U.S. authorities seized 170,000 BTC from Ross Ulbricht, the founder of the Silk Road marketplace. 

Later, in 2020, another 69,370 BTC was seized, followed by 50,000 BTC in a separate case.

Last year, the U.S. government transferred $33.6 million worth of Bitcoin and digital currencies from a wallet holding funds seized from FTX Alameda Research.

Bitcoin Auctions Draw Criticism

Instead of holding these digital assets, the U.S. Marshals Service (USMS) auctioned them off in multiple sales. These decisions, now heavily criticized, resulted in Bitcoin being sold for a fraction of today’s value.

The Department of Justice (DoJ) also approved several Bitcoin auctions over the years, but many now believe this was a mistake. The last Bitcoin sale occurred just ten days before President Donald Trump returned to office. 

Many in the crypto industry believe these sales were a costly mistake, as the country is missing out on massive profits. Bitcoin’s price is increasing despite volatility, making it clear that the government undervalued its potential.

In a recent X post, crypto supporter Jane Adams voiced her frustration, calling the Bitcoin sales bad management. She said the government wasted taxpayers’ money and could have used the Bitcoin wisely if they had planned for the future.

U.S. Plans Toward a New Strategy For Bitcoin Holdings 

President Trump’s U.S. government has announced plans for a Crypto Strategic Reserve, which will include Bitcoin and other digital assets. Many hope discussions will focus on ending Bitcoin auctions at the upcoming White House Crypto Summit. 

There are also expectations that the U.S. will buy more Bitcoin to strengthen U.S. reserves. While the government cannot undo past sales, new strategies could change how the U.S. handles crypto assets.