Bitcoin prices fell from a six-week high as market attention turned to speculation that the US government might sell seized Bitcoin. On Monday, the US transferred $2 billion worth of Bitcoin to a new digital wallet address, according to blockchain research firm Arkham. These tokens are believed to be from the Silk Road marketplace, a now-defunct online black market known for illegal drug and hacker tool transactions.

Impact of Trump’s Pro-Crypto Agenda

Over the weekend, former President Donald Trump, the Republican presidential nominee, pledged to create a government Bitcoin stockpile if re-elected. He promised to make the US the “crypto capital of the planet” and a “Bitcoin superpower.” His announcement initially boosted Bitcoin prices, but the market faced a subsequent downturn.

Shiliang Tang, president of Arbelos Markets, highlighted the market’s ongoing supply concerns despite positive news from the Bitcoin 2024 conference, where both Trump and Senator Cynthia Lummis spoke in favor of Bitcoin.

Spencer Hallarn from GSR noted a spike in short-term call buying ahead of Trump’s speech, followed by a shift to selling, which added pressure on Bitcoin prices. Bitcoin rose to nearly $70,000 on Monday before dropping 2.2% to $66,482.

Government Bitcoin Moves Criticized

Some traders speculate that the timing of the US government’s Bitcoin transfer was intentional, coming just days after Trump’s pledge not to move seized crypto. Galaxy Digital head Michael Novogratz criticized the move on social media, calling it “tone deaf.”

Trump’s speech in Nashville included a proposal to use seized crypto as a basis for a strategic Bitcoin stockpile, further solidifying Bitcoin as a significant topic in the upcoming election.

Meanwhile, anticipation builds for the Federal Reserve meeting later this week, which is expected to discuss the start of a rate-cutting cycle. This prospect has uplifted market sentiment despite the current volatility in the Bitcoin market.