The US government moved roughly $9 million worth of Ethereum to Coinbase Prime this week, according to blockchain data. The deposit comes from wallets linked to assets seized from FTX, the crypto exchange that imploded in late 2022.
On-chain sleuths spotted the transaction early Wednesday. It's the latest in a series of government-controlled wallet movements tied to FTX's bankruptcy estate. The funds were sent to a Coinbase Prime deposit address, a service the US Marshals Service and Department of Justice have used before to sell or custody seized crypto.
A $9M ETH deposit
The transfer involved roughly 2,500 ETH, worth about $9 million at current prices. The government's FTX-linked wallets still hold hundreds of millions of dollars in crypto, including Bitcoin, Ethereum, and Solana. This is not the first time the US has moved seized FTX assets to Coinbase — similar deposits happened earlier this year.
Why Coinbase Prime? The exchange's institutional arm has contracts with the US government for custody and liquidation services. The Marshals Service has auctioned off Bitcoin through Coinbase before. For Ethereum, the process is similar: the government deposits, then sells in batches to avoid moving the market.
Coinbase as government custodian
Coinbase Prime is the go-to platform for the US government's crypto operations. The exchange won a contract with the US Marshals Service in 2023 to handle seized digital assets. Since then, multiple deposits from forfeiture cases — Silk Road, Bitfinex hack, and now FTX — have landed in Coinbase wallets.
The arrangement gives the government a regulated on-ramp to sell large amounts of crypto without running its own exchange. For Coinbase, it's a steady stream of institutional business and a sign of trust from Washington.
FTX victims still waiting
The FTX bankruptcy estate has been repaying creditors in stages. The first round of distributions went out earlier this year, but many smaller victims are still waiting. The government's seizure of FTX assets — including Alameda Research's crypto and bank accounts — is separate from the bankruptcy proceedings. The DOJ's forfeiture process aims to return money directly to victims, but it moves slowly.
This $9 million deposit is a small piece of a much larger puzzle. FTX's collapse left a $8 billion hole. The government has recovered billions through asset seizures and the sale of seized property, but the final tally is still being calculated.
Next steps in the case
The government hasn't announced a sale date for this Ethereum batch. Past deposits to Coinbase Prime have been followed by quiet liquidation over weeks. The DOJ typically doesn't telegraph its moves to avoid front-running.
Meanwhile, the FTX bankruptcy court is still approving claims. The next deadline for creditor objections is August 15. The government's asset sales will likely continue through the rest of 2026, with proceeds going to a victim compensation fund.
