Do the U.S. Marshals Service's sale of seized Bitcoins violate Trump's executive order?
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Do the U.S. Marshals Service's sale of seized Bitcoins violate Trump's executive order?
On November 3, 2025, the U.S. Marshals Service, seemingly under the direction of the Department of Justice, liquidated the Bitcoin forfeited by Samourai developers in their plea agreement using Coinbase Prime. This action likely violated President Trump's directive to retain such Bitcoin within the U.S. Strategic Bitcoin Reserve.
Navigating Web3 tides with focused insightsWritten by: Frank Corva
Compiled by: Chopper, Foresight News
The U.S. Marshals Service (USMS) appears to have liquidated the Bitcoin forfeited by Samourai wallet developers Keonne Rodriguez and William Lonergan Hill, valued at $6.3 million, as part of their plea agreements.
This action potentially violates Executive Order 14233. The order stipulates that Bitcoin obtained by the government through criminal or civil asset forfeiture proceedings should be held in the U.S. Strategic Bitcoin Reserve, not liquidated.
If the U.S. District Court for the Southern District of New York, which is overseeing the Samourai case, indeed violated Executive Order 14233, it would not be the first time its personnel have defied federal government directives.
Where Did the Bitcoin Go?
Bitcoin Magazine obtained a previously undisclosed "Asset Liquidation Agreement" document. The document indicates that the Bitcoin forfeited by Rodriguez and Hill was either about to be sold or had already been liquidated.
According to the agreement, the two defendants agreed to transfer 57.5 Bitcoin to the U.S. Marshals Service. On the final signing date of the agreement, November 3, 2025, this Bitcoin was valued at approximately $6.36 million.
On November 3, 2025, this Bitcoin was transferred out from address bc1q4pntkz06z7xxvdcers09cyjqz5gf8ut4pua22r. However, it does not appear to have gone into a direct custody account of the U.S. Marshals Service. Instead, it was directly transferred to the Coinbase Prime wallet address 3Lz5ULL7nG7vv6nwc8kNnbjDmSnawKS3n8, presumably for liquidation.
Currently, the balance of that Coinbase Prime address is zero, meaning this Bitcoin has most likely been sold.
Violation of Executive Order 14233
Once the U.S. Marshals Service confirms the sale of this forfeited Bitcoin, it constitutes a violation of Executive Order 14233. The order explicitly requires that Bitcoin obtained by the government through criminal forfeiture proceedings "shall not be sold" and must be placed into the U.S. Strategic Bitcoin Reserve.
The USMS's sale of this Bitcoin was based on its own discretion, not a legal mandate. This suggests that some personnel within the Department of Justice may still view Bitcoin as a "taboo asset" to be quickly liquidated, rather than as a strategic asset that President Trump has directed government agencies to hold.
It is worth noting that the investigation and prosecution of Samourai began during the previous administration, which held strong hostility towards non-custodial cryptocurrency tools and their developers. Therefore, the DOJ's decision to ignore Executive Order 14233 and proceed with the Bitcoin sale continues the previous administration's approach of treating Bitcoin as an asset to be cleared from the government's balance sheet as soon as possible.
Legal Details Related to Forfeiture and Liquidation
According to a legal source familiar with the matter, the Samourai developers' Bitcoin was forfeited under Title 18, U.S. Code, Section 982(a)(1). This provision states that any property involved in a crime violating Title 18, U.S. Code, Section 1960, which prohibits operating an unlicensed money transmitting business, is subject to forfeiture to the United States.
Combining Title 18, U.S. Code, Section 982 with its reference to Title 21, U.S. Code, Section 853(c) (a criminal forfeiture statute stating that "property transferred to a person other than the defendant may be subject to a special forfeiture verdict and subsequently ordered forfeited to the United States"), the Bitcoin forfeited from Rodriguez and Hill fully meets the definition of "Government Bitcoin" under Executive Order 14233.
Neither Title 18, U.S. Code, Section 982, nor the referenced Title 21, Section 853, mandates the liquidation of criminally forfeited property. Furthermore, the two forfeiture fund management statutes cited in Section 3 of Executive Order 14233—Title 31, U.S. Code, Section 9705 and Title 28, U.S. Code, Section 524(c)—only regulate the deposit accounts for forfeiture funds and their usage; they do not require converting forfeited Bitcoin into fiat currency.
The Executive Order also clearly states that "Government Bitcoin" falls under the category of "Government Digital Assets" and mandates that "the head of each agency shall not sell or otherwise dispose of any Government Digital Asset," with exceptions only under specific circumstances. The Rodriguez and Hill case does not meet any of these exceptions; moreover, in all exceptional cases, the U.S. Attorney General must be involved in deciding the disposition of forfeited digital assets.
The "Sovereign District" of the Southern District of New York
Considering Executive Order 14233 and the various statutes cited in this article, the actions of the U.S. District Court for the Southern District of New York clearly violate the core requirement of the order to "transfer criminally forfeited Bitcoin to the U.S. Strategic Bitcoin Reserve."
And this is far from the first time this court has exhibited such defiance.
Often jokingly referred to as the "Sovereign District of New York," this jurisdiction is notorious for its independent and high-handed actions, frequently operating outside of control even within the federal judicial system.
The court's insistence on pursuing cases against Rodriguez, Hill, and Tornado Cash developer Roman Storm is further evidence of its willful independence.
On April 7, 2025, U.S. Deputy Attorney General Todd Blanche issued a memorandum titled "Ending the Regulation by Enforcement Model," explicitly stating that "the Department will no longer bring charges against developers of virtual currency exchanges, mixing services, and offline wallets based on the conduct of end-users..."
However, the Southern District of New York ignored this core principle of the memorandum and continued to forcefully advance the prosecution of cases related to Samourai Wallet and Tornado Cash.
More notably, Hill and Rodriguez's defense team, citing Brady Rule requirements (which compel prosecutors to disclose exculpatory evidence to the defense), obtained documents showing that two senior officials from the U.S. Treasury's Financial Crimes Enforcement Network (FinCEN) had explicitly stated that, given its non-custodial nature, Samourai Wallet did not constitute a money transmitting business. Despite this, prosecutors proceeded with the indictment.
In criminal cases tried in the U.S. federal court system, over 90% of defendants are ultimately convicted and sentenced, with acquittal rates in some years as low as 0.4%. The prosecution team in the Southern District of New York is particularly renowned for its conviction rate, which far exceeds the federal average.
Rodriguez was well aware of such statistics. He also knew that Judge Denise Cote, presiding over his and Hill's case, is known for imposing harsh sentences.
On the morning before he pleaded guilty to the charge of "conspiracy to operate an unlicensed money transmitting business," Rodriguez confided all of this to the author.
Is the Crypto War Really Over?
In the 2024 election, many Bitcoin and cryptocurrency supporters voted for President Trump, and the crypto industry strongly backed his re-election campaign. Now, these supporters and industry figures are questioning whether President Trump truly intends to end the war on cryptocurrency.
To achieve this goal, the Department of Justice under the Trump administration must strictly adhere to the requirements of Executive Order 14233 and follow the guidelines of Deputy Attorney General Blanche to cease prosecuting developers of non-custodial cryptocurrency technology. Regarding the latter, President Trump recently indicated he is considering a pardon for Rodriguez.
Pardoning Rodriguez and ordering the DOJ to thoroughly investigate the sale of the forfeited Bitcoin from the Samourai developers would send a strong signal that the President is serious and steadfast in his pro-Bitcoin and cryptocurrency stance.
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