The U.S. Department of Justice appears to have violated President Donald Trump’s executive order by liquidating 57 Bitcoin forfeited by Samourai Wallet developers through Coinbase Prime on November 3, 2025.
Executive Order 14233, signed March 6, 2025, explicitly mandates that Bitcoin acquired via criminal or civil asset forfeiture proceedings “shall not be sold” and must be transferred to the United States Strategic Bitcoin Reserve.
According to an Asset Liquidation Agreement obtained exclusively by Bitcoin Magazine, prosecutors directed the U.S. Marshals Service to sell $6.3 million worth of Bitcoin that Samourai developers Keonne Rodriguez and William Lonergan Hill paid as part of their guilty plea.
The Bitcoin was sent directly to Coinbase Prime address 3Lz5ULL7nG7vv6nwc8kNnbjDmSnawKS3n8, which currently shows a zero balance, indicating the assets may have already been liquidated.
Defying Federal Guidance on Multiple Fronts
This marks the second instance in which the Southern District of New York has acted against federal directives in the Samourai case.
On April 7, 2025, Deputy Attorney General Todd Blanche issued a memo titled “Ending Regulation By Prosecution,” stating “the Department [of Justice] will no longer target virtual currency exchanges, mixing and tumbling services, and offline wallets for the acts of their end users.“
Despite this clear guidance, SDNY prosecutors proceeded with cases against Rodriguez, Hill, and Tornado Cash developer Roman Storm.
The prosecution also moved forward after learning, through a Brady request, that two high-ranking FinCEN officials “strongly suggested” that Samourai Wallet wasn’t operating as a money transmitter because of its non-custodial nature.
The SDNY has earned its colloquial nickname “Sovereign District of New York” for operating independently within the federal system, boasting conviction rates exceeding 90% and a reputation for harsh sentencing.
Amongst many others, Senator Cynthia Lummis has particularly criticized this move, saying the United States “can’t afford to squander these strategic assets while other nations are accumulating bitcoin.”
“I’m deeply concerned about this report,” she added.
Legal Framework and Presidential Intent
Trump’s executive order established two distinct entities:
- The Strategic Bitcoin Reserve for forfeited Bitcoin.
- The United States Digital Asset Stockpile for other cryptocurrencies.
The order explicitly states that “Government BTC deposited into the Strategic Bitcoin Reserve shall not be sold and shall be maintained as reserve assets of the United States utilized to meet governmental objectives in accordance with applicable law.“
According to legal analysis, the forfeited Bitcoin falls under 18 U.S. Code § 982(a)(1), which governs property involved in unlicensed money transmitting offenses.
Neither this statute nor the incorporated § 853 requires liquidation of forfeited property.
The executive order only permits disposal of digital assets in specific scenarios, such as returning funds to crime victims, law enforcement operations, sharing with state partners, or satisfying specific statutory requirements, none of which apply to the Rodriguez and Hill cases.
Back in April 2025, White House crypto adviser Bo Hines emphasized that any Bitcoin accumulation strategy must be “budget neutral,” and the administration wasexploring creative approaches, including tariff revenue and revaluing gold reserves.
Treasury Secretary Scott Bessent also clarified in August that the country is “not going to be buying that, but we are going to use confiscated assets and continue to build that up.“
Questions About Ending the War on Crypto
Rodriguez received a five-year sentence on November 6, while Hill was sentenced to four years on November 19 for operating Samourai Wallet, which prosecutors claimed processed over $237 million in criminal proceeds.
Both developers forfeited the $6.3 million in fees earned from their platform’s operations.
On December 16, President Trump indicated he would consider pardoning Rodriguez after being asked about the case during an Oval Office event.
“I’ve heard about it, I’ll look at it,” Trump told reporters, directing Attorney General Pam Bondi to examine the matter.
Rodriguez responded on social media, stating, “this President knows all about lawfare. He knows all about a weaponized Biden DOJ hunting down their political rivals.“
Trump has previously pardoned Ross Ulbricht and Changpeng Zhao in related crypto cases, and has raised optimism of a similar pardon for Rodriguez.
The liquidation contradicts the administration’s stated goal of treating Bitcoin as a strategic asset on par with gold reserves.
As a result, Patrick Witt, Executive Director of the White House President’s Council of Advisors for Digital Assets, said on X that the council is looking into the matter.
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