Bitcoin may soon encounter market pressure as the UK assesses selling $7.1 billion in BTC seized in 2018 from a Chinese Ponzi scheme.

The potential Bitcoin sale by the UK government holds significant implications for the cryptocurrency market, with anticipated short-term price volatility.

The UK government plans to sell over 61,000 Bitcoin seized from the 2018 Tianjin Lantian Gerui scam. Bitcoin’s price could face short-term volatility if the sale proceeds amidst current market conditions. The action involves critical UK agencies including the Home Office and Treasury, with Chancellor Rachel Reeves at the helm. Legal issues remain unresolved, making the sale tentative. As Susie Violet Ward, CEO of Bitcoin Policy UK, noted, “No sale can happen while that legal process is unresolved.”

The potential liquidation of the seized Bitcoin may affect market liquidity, influencing Bitcoin’s price and related digital assets. Historically, government sales have triggered temporary market reactions but no lasting price declines. Market observers remain cautious, noting previous instances where similar actions mostly had short-lived effects on prices. Experts suggest a “wait and see” approach as all legal barriers remain intact.

The potential financial and regulatory outcomes of this sale could lead to short-term market adjustments, while regulatory scrutiny may increase. Long-term effects will hinge on how the sale is executed and absorbed by the market, reminiscent of past cases.