The US government currently holds an additional $14 billion in Bitcoin. The only question is, what are they going to do with all that digital gold?
On Tuesday, the Justice Department announced that it had successfully seized $14.4 billion worth of Bitcoin from Cheng Zhi, the head of a conglomerate based in Cambodia, considered the center of the global economy. cryptocurrency scam Surgery. This seizure is the largest in the history of the Department of Justice.
U.S. prosecutors are currently filing criminal charges against Chen for wire fraud and money laundering, as well as seeking legal recourse to formalize ownership of the seized bitcoins through criminal forfeiture. If they win, will that historic Bitcoin pile be added to President Donald Trump's new strategic Bitcoin reserve? Or will the funds be used to repay Chen's alleged victims?
A clear answer to this question may not materialize for some time. The Treasury Department oversees the country's Bitcoin holdings. directly related In Chen Zhi's case, he did not respond. decryptionis seeking comment on its plans to use the seized funds.
However, with so much Bitcoin at stake, the potential impact of the US government's final decision on this issue is significant. Already, some of the most prominent promoters of the president's Bitcoin reserve plan are using the funds seized today to fund their projects.
“Turning the proceeds of crime into an asset that strengthens America's strategic Bitcoin reserve shows how sound policy can turn fraud into an enduring national value,” Sen. Cynthia Lummis (R-Wyo.) said Tuesday in a statement celebrating the Trump administration's action against Chen Zhi.
🧵Second, we will codify how seized Bitcoins will be stored, returned to victims, and protected for future generations. Turning the proceeds of crime into an asset that powers the United States' strategic Bitcoin reserve shows how sound policy can turn fraud into an enduring national value.
— Sen. Cynthia Lummis (@SenLummis) October 14, 2025
The senator who proposed law It would require the US government to purchase more than $100 billion worth of Bitcoin to shore up existing holdings of the token, adding that Tuesday's events underscore the need for Congress to pass legislation codifying how seized Bitcoin will be stored and returned to victims.
Scott Johnson, a financial lawyer and venture capitalist specializing in cryptocurrencies, predicted that the U.S. government would likely keep a “huge amount” of the seized bitcoins. He thought the rest would be used to repay victims, but only after a year-long process of unraveling the alleged fraudster's global money-laundering network and verifying claims from individuals in dozens of countries.
“This is really the most extreme example of illicit funds seizure imaginable in terms of complexity,” Johnson said. said With X.
said Ari Redboard, a former U.S. Treasury official and federal prosecutor who now heads global policy at the TRM Institute. decryption It is difficult to predict how much of the newly seized bitcoins the U.S. government will ultimately place in its strategic reserve, rather than bailing out the alleged victims in their entirety.
“That's a really difficult question,” he said.
If the funds were added to the US Bitcoin reserve, the value of that stockpile could increase significantly, but that amount is also currently unknown.
Blockchain analytics company Arkham Intelligence is currently estimate Approximately $22 billion worth of BTC is reportedly stored in cryptocurrency wallets controlled by the U.S. government. This means that this week's Bitcoin shipments will significantly increase the value of the national Bitcoin reserve. However, Arkham's findings have not been confirmed by the federal government.
When President Trump signed the agreement, presidential order After establishing Bitcoin's strategic readiness in March, he tasked the Treasury Department and the White House Cryptocurrency Task Force to determine by April exactly how much cryptocurrency the government currently holds. By May, the Treasury Secretary was expected to submit to the White House an assessment of the “legal and investment considerations” for creating the reserve.
The White House released a comprehensive report on crypto policy in July, which noted that the Treasury Secretary had indeed communicated such an assessment to the White House, but omitted findings on the size of the U.S. government's current Bitcoin holdings.
Neither the Treasury nor the White House responded. decryptionRequest for comment on the status of efforts to determine how much Bitcoin the government currently holds.
