Key Facts
- ✓ The U.S. Marshall Service allegedly sold 57.55 Bitcoin worth $6.3 million.
- ✓ The sale potentially violates Executive Order 14233, which mandates holding Bitcoin in a Strategic Reserve.
- ✓ Assistant U.S. Attorney Cecilia Vogel signed the asset liquidation agreement on November 3, 2025.
- ✓ The Bitcoin was sent directly to a Coinbase Prime address rather than USMS custody.
Quick Summary
Documents obtained exclusively reveal that the U.S. Marshall Service (USMS) has potentially liquidated Bitcoin forfeited by Samourai Wallet developers. This action stands in direct conflict with Executive Order 14233, which mandates that Bitcoin seized by the government must be retained in a Strategic Bitcoin Reserve.
The transaction involved 57.55 BTC, valued at approximately $6.3 million, transferred by defendants Keonne Rodriguez and William Lonergan Hill. Rather than holding the assets, the funds were reportedly routed to a Coinbase Prime address with a zero balance, suggesting immediate liquidation. This decision highlights a potential rift between the executive branch's crypto strategy and the enforcement actions of the Department of Justice.
The Asset Liquidation Agreement
A document titled "Asset Liquidation Agreement" details the transfer of assets from the Samourai Wallet case. According to the agreement, defendants Keonne Rodriguez and William Lonergan Hill agreed to transfer 57.55353033 Bitcoin to the USMS. The final signature on the agreement was provided by Assistant United States Attorney Cecilia Vogel on November 3, 2025.
On the same day, the Bitcoin was transferred from the defendants' wallet address. However, instead of entering USMS custody, the funds appear to have been sent directly to a Coinbase Prime brokerage address. Blockchain analytics indicate that this address currently holds a zero balance, strongly suggesting the Bitcoin was sold shortly after receipt. This liquidation process bypassed the holding period typically associated with strategic asset retention.
Executive Order 14233 Violation
The sale of these assets likely contravenes Executive Order 14233. This order explicitly states that Bitcoin acquired by the U.S. government through criminal forfeiture—termed "Government BTC"—shall not be sold. Instead, the order mandates that these assets be contributed to the United States' Strategic Bitcoin Reserve (SBR).
By selling the Bitcoin, the Southern District of New York (SDNY) acted at its own discretion rather than following the legal mandate from the executive branch. This suggests that certain elements within the Department of Justice continue to view Bitcoin as an asset to be offloaded rather than a strategic reserve. The liquidation indicates a preference for converting the digital currency into cash immediately, disregarding the policy to hold it long-term.
Legal Context and Precedent
The forfeiture was legally grounded in 18 U.S. Code § 982(a)(1), which applies to the operation of unlicensed money transmitting businesses. Legal analysis confirms that the forfeited Bitcoin fits the EO's definition of "Government BTC". Furthermore, the cited forfeiture statutes do not require that property be liquidated; they only regulate where proceeds are deposited.
The SDNY has a reputation for operating independently, often colloquially referred to as the "Sovereign District of New York". This incident is not the first time the district has defied federal guidance. Despite a memo from Deputy Attorney General Todd Blanche titled "Ending Regulation By Prosecution"—which stated the DOJ would not target offline wallets for the acts of their users—the SDNY proceeded with the Samourai Wallet case. Additionally, the prosecution continued even after learning that FinCEN officials believed the noncustodial service did not serve as a money transmitter.
