On July 1st, the US Marshals Service, an agency within the US Department of Justice, announced that it had signed a custody contract with Coinbase, the largest cryptocurrency exchange in the country. The US authorities will pay $32.5 million to have Coinbase oversee their assets and provide “additional advanced trading services.”
A Coinbase representative stated, “After a thorough evaluation of various solutions, the US Marshals Service chose Coinbase for our institutional-grade crypto custody experience and capabilities.”
Just announced: the U.S. Marshals Service selects Coinbase Prime to provide custody and advanced trading services for its large cap digital assets portfolio.
Read more about this partnership ↓https://t.co/6CCTz1EGQj pic.twitter.com/zM4R0giDrY
— Coinbase Institutional ????️ (@CoinbaseInsto) July 1, 2024
Interestingly, the contract also includes provisions for the “liquidation of large amounts of popular cryptocurrencies” as part of government seizure programs.
Recently, US government crypto wallets have frequently transferred funds to exchanges, causing some investors to fear large-scale sell-offs. According to Arkham, the US still holds $13.8 billion in crypto assets seized from illegal activities. This includes 213,534 BTC ($13.4 billion), 50,524 ETH ($174.2 million), 121 million USDT, and many other altcoins.
Some find the custody agreement between the US Marshals Service and Coinbase surprising, as Coinbase is currently being sued by the US Securities and Exchange Commission (SEC) for allegedly providing unlicensed securities services. In response, Coinbase has countersued the SEC, claiming that the commission is intentionally hindering the crypto industry’s growth.
