How Much Bitcoin Do Governments Hold?

Retail investors and institutions are not the only ones holding Bitcoin in their portfolios; governments worldwide do too. Unsurprisingly, the United States government is the largest Bitcoin holder, with over 213,297 BTC. However, in most cases, the source of this cryptocurrency is predominantly from seizures of criminal activity.

How Much Bitcoin Do Governments Hold?

As of July 29, 2024, governments around the world hold 2.2% of Bitcoin's total supply, or 471,380.6 BTC, worth $32.7 billion. Governments are increasing their holdings of Bitcoin, either by seizing them from criminal activities or donations or by actively purchasing them. This trend reflects the growing importance and recognition of digital assets in the global financial system.

United States

The United States is the largest holder of Bitcoin, possessing 213,297 BTC obtained through cryptocurrency seizures. The current value of the U.S. Bitcoin holdings is roughly $14.82 billion. A significant portion came from the shutdown of Silk Road, an online black market and one of the first modern darknet markets. When the U.S. government dismantled the Silk Road, they seized approximately 69,000 BTC.

China

Despite China’s crackdown on cryptocurrency trading and mining, it holds significant Bitcoin reserves from seizures, making it the second-largest governmental Bitcoin holder. The Chinese government now has approximately 190,000 BTC, valued at around $13.20 billion. Most of this Bitcoin was seized from the PlusToken Ponzi scheme, one of the largest cryptocurrency scams, which promised investors returns of up to 30%.

United Kingdom

The United Kingdom has seized around 61,000 BTC, worth approximately $4.24 billion, from a money laundering operation. Multiple wallets linked to a Chinese takeaway worker were discovered, revealing that the worker converted cryptocurrency to cash or assets in Dubai. These seizures highlight the UK's commitment to tackling financial crimes involving digital assets, placing the UK third among governments with the highest crypto holdings.

El Salvador

El Salvador stands out as the first country to adopt Bitcoin as legal tender. El Salvador has been actively purchasing Bitcoin, unlike other governments that primarily hold cryptocurrencies through seizures. The country now holds 5,800 BTC, worth approximately $0.40 billion. In 2021, El Salvador became the first country to declare Bitcoin as legal tender. Since November 2022, the government has implemented the “1 Bitcoin per Day” program, purchasing 1 BTC daily regardless of its market value. This proactive approach has placed El Salvador at the forefront of national cryptocurrency adoption.

Ukraine

Ukraine, on the other hand, has received the majority of its Bitcoin through donations to aid its war efforts against Russia. In February 2022, the government posted its Bitcoin wallet address on “X” to request donations. To date, the wallet has received 651.3 BTC ($45.23 million). Additionally, the "Come Back Alive Foundation" in Ukraine has set up a wallet to receive donations to support the military. This foundation has received a total of 685.1 BTC ($47.58 million). While these donations total 1,336.4 BTC, the current balance stands at 186.18 BTC (~$12.93 million) as the funds are actively being used to aid its war efforts.

Germany

Germany has proactively enforced cryptocurrency-related laws, leading to the confiscation of 46,359 BTC, valued at about $3.02 billion. This seizure resulted from a 2013 operation against a piracy website that violated the Copyright Act. The proceeds from the piracy operation were converted to Bitcoin, contributing to Germany’s substantial holdings. However, as of July 12, 2024, the government had liquidated their entire holdings.

Implication of Government Holdings

Governments with large crypto holdings can significantly impact market prices through their actions. A recent example is the German government's liquidation of all of its bitcoin holdings (46,359 BTC) between June 19 and July 12, 2024. This sparked a selloff, which caused Bitcoin to drop 15.7%, from $64,547.32 to as low as $54,418.46.

Governments With Bitcoin Holdings

Government cryptocurrency holdings reflect a complex interplay of law enforcement actions and financial strategies. The top five governments with significant Bitcoin holdings are:

As cryptocurrency adoption increases, governments will likely develop more regulations on crypto assets. This would lead to more active cryptocurrency crackdowns, reducing crypto-related scams and creating a safer environment for retail investors.

Furthermore, some governments may choose to actively purchase cryptocurrencies as part of their financial strategies, driven by a desire to diversify national reserves and embrace digital finance innovations. Stricter regulations could also lead more countries to invest in Bitcoin through over-the-counter (OTC) purchases or ETF exposure.

These diverse approaches—from seizures to active investments—illustrate the multifaceted impact of cryptocurrencies on national and global economies. As digital assets continue to integrate into the global financial system, government-held cryptocurrencies will play a pivotal role in shaping the future of cryptocurrency adoption and regulation, ensuring a balance between innovation and security in the evolving digital finance landscape.

Methodology

This study examined data on the top government Bitcoin holdings as of July 29, 2024, from ArkhamIntelligence.com and Bitcointreasuries.net, as well as news articles from Reuters, BlockWorks.co, and Bitcoin.com. The top five governments holding Bitcoin are the United States, China, the United Kingdom, Germany, El Salvador, and Ukraine. Holdings in US Dollars (USD) were calculated using the price of Bitcoin at $69,482.75.

This article was co-authored by Prem Reginald (@Jujubz_eth)

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