The United States government's Strategic Bitcoin Reserve, which holds approximately 328,372 BTC, faces a potential reduction of roughly 30% due to ongoing legal proceedings related to the 2016 Bitfinex hack. U.S. prosecutors asked a federal court in January 2025 to authorize the return of about 94,643 BTC as in-kind restitution to the exchange or its affected customers.
According to Vetle Lunde, Head of Research at K33 Research, "Approximately 94,636 BTC tied to the Bitfinex hack, roughly 30% of the U.S. Strategic Bitcoin Reserve, remain subject to legal proceedings and could ultimately be returned to victims rather than retained as sovereign assets." The core legal question is whether these seized and forfeited coins should be returned to Bitfinex or directly to the customers impacted by the hack.
Importantly, this represents a legal transfer of asset custody, not a market sale event. If granted, the coins would move from government-controlled wallets to the entitled party without being liquidated for cash, meaning the event would not directly add sell pressure to the market.
The market is already signaling anticipation of a favorable outcome for Bitfinex. The exchange's native LEO token has been trading at a notable premium—reportedly as high as 60%—as participants expect progress on restitution. Bitfinex has pledged to use 80% of any recovered funds to repurchase and burn LEO tokens, which would reduce its circulating supply.
Should the court rule in favor of the victims, analysts suggest that up to 75,000 BTC could gradually re-enter the market over an 18-month period. However, experts note this potential sell-off flow would likely be moderate compared to the typical movements from ETFs and long-term large holders (whales). The resolution of this case is pivotal in defining the final size of the U.S. government's Bitcoin holdings, which are sourced from Department of Justice forfeitures and not open-market purchases.
