Summary:
Brian Armstrong opposes U.S. government selling Bitcoin holdings.
Recent transfer of 19,800 Bitcoin valued at $1.9 billion has sparked debate.
Armstrong calls it a huge strategic mistake for the U.S. to sell Bitcoin.
Concerns raised about the strategic value of Bitcoin and potential regrets from selling.
Market speculation suggests not all government transfers are intended for sale.
Coinbase CEO Brian Armstrong recently expressed his strong opposition to the U.S. government selling its Bitcoin holdings, amidst growing concerns over large government transfers of the cryptocurrency.
Background on Recent Transfers
On December 2, 19,800 Bitcoin, valued at approximately $1.9 billion, were transferred to a Coinbase Prime deposit address, igniting a heated debate about the implications of such sales.
Armstrong's Position
Armstrong stated, "This is a huge strategic mistake. There is no price where it makes sense for the U.S. to sell any Bitcoin it has under its control." He emphasized the strategic value of Bitcoin and echoed sentiments from Jason Lowery, a U.S. Space Force major, who tweeted that the government should never sell its Bitcoin.
Strategic Concerns Over Bitcoin Sales
Lowery further articulated that the government may not fully grasp Bitcoin's strategic importance, likening the potential sale to shortsighted policies of the past. He warned that the U.S. might later regret selling Bitcoin due to a lack of understanding of its significance. He referenced Executive Order 6102, a 1933 directive against hoarding gold, suggesting that future policies might aim to reacquire Bitcoin after a sale.
Diverging Opinions
The criticism didn't stop with Armstrong and Lowery. Toby Cunningham, a crypto educator, labeled the potential sale as “dumb,” arguing that the market would quickly absorb any Bitcoin sold. Meanwhile, Gabor Gurbacs, a strategy advisor at Tether, noted that the recent transfers could simply be updates to custody rather than actual sales, stating, "There is also a lot we don't know. It's not guaranteed they will sell. I haven't seen any official auction information yet."
Market Implications
Despite the government moving 25,999 Bitcoin this year, analytics suggest that not all transfers are meant for sale. Spot On Chain indicated that these movements could involve consolidating wallets or upgrading security. CryptoQuant’s head of research, Julio Moreno, mentioned that it was "highly likely" only 10,000 Bitcoin were sold, with the rest transferred to a new wallet.
Currently, the U.S. government holds about 183,850 BTC, valued at $17.7 billion across various addresses. Armstrong concluded by urging the government to recognize the significance of Bitcoin technology before making irreversible decisions.
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