It appears that evidently the U.S. Marshall Service (USMS) has offered the $6.3 million price of bitcoin that Samourai Pockets builders Keonne Rodriguez and William Lonergan Hill paid the U.S. Division of Justice (DOJ) as a price that was a part of their responsible plea.
In doing so, it has probably violated Govt Order (EO) 14233, which mandates that bitcoin acquired by way of legal or civil asset forfeiture proceedings must be held as a part of the US’ Technique Bitcoin Reserve (SBR).
If the Southern District of New York (SDNY), the federal judicial district through which the Samourai case was to be tried, did, in reality, violate EO 14233, it could not be the primary time staff of the SDNY have acted in defiance of route from the federal authorities.
What Occurred to the Bitcoin?
In keeping with a doc titled “Asset Liquidation Settlement”, which has been obtained solely by Bitcoin Journal and has not till now been made public, the bitcoin that Rodriguez and Hill forfeited is to be offered — or already has been.
As per the doc, the defendants agreed to switch $6,367,139.69 price of bitcoin — 57.55353033 bitcoin on the time the ultimate celebration signed the settlement, which was Assistant United States Legal professional Cecilia Vogelon November 3, 2025 — to the USMS.
The bitcoin, which was despatched from tackle bc1q4pntkz06z7xxvdcers09cyjqz5gf8ut4pua22r on November 3, 2025, appears to have bypassed any direct custody by the USMS. As a substitute, it appears to have been despatched on to Coinbase Prime tackle 3Lz5ULL7nG7vv6nwc8kNnbjDmSnawKS3n8 (Arkham Intel attributes this tackle to the brokerage), presumably to be offered.
This Coinbase Prime tackle at the moment has a zero stability, indicating that the bitcoin might have already been offered.
Violating Govt Order 14233
If the USMS has offered the forfeited bitcoin, it doubtless contravened EO 14233, which orders that bitcoin acquired by the U.S. authorities by way of legal forfeiture, termed “Authorities BTC” within the EO, “shall not be offered” and must be contributed into the U.S. SBR.
If the USMS offered the bitcoin, they did so at their very own discretion and never as a authorized mandate, which signifies that sure members of the DOJ should still view bitcoin as a taboo asset to be offloaded versus a strategic asset that President Trump has directed authorities companies to retain.
On condition that the Samourai prosecution originated underneath the earlier administration, which was notoriously hostile towards noncustodial crypto instruments and their builders, the choice to disregard EO 14233 and promote the bitcoin regardless of a mandate from the chief department suits a sample of treating bitcoin as one thing that must be faraway from authorities stability sheets as quickly as potential.
Authorized Particulars Concerning the Forfeiture and Liquidation
In keeping with a authorized supply near this matter, the Samourai builders’ forfeited their bitcoin underneath 18 U.S. Code § 982(a)(1), which stipulates that any offense that violates 18 U.S. Code § 1960, the statute that prohibits the operation of unlicensed cash transmitting companies, orders that particular person to forfeit to the US any property concerned within the offense.
Judging by § 982 and its incorporation of 21 U.S.C. § 853(c), a legal forfeiture statute that stipulates that “property that’s subsequently transferred to an individual apart from the defendant often is the topic of a particular verdict of forfeiture and thereafter shall be ordered forfeited to the US,” the bitcoin that Rodriguez and Hill forfeited suits the EO’s definition of “Authorities BTC”.
Neither § 982 nor the included § 853 requires that property that’s forfeited as a part of a legal offense be liquidated. Moreover, the fund forfeiture statutes cited in part three of the EO — 31 U.S.C. § 9705 and 28 U.S.C. § 524(c) — regulate the place forfeiture proceeds are deposited and the way they could be used; they don’t require that forfeited bitcoin be transformed to money somewhat than held in sort.
The EO additionally stipulates that “Authorities BTC” falls underneath the umbrella of “Authorities Digital Belongings” and states that “the pinnacle of every company shall not promote or in any other case get rid of any Authorities Digital Belongings” besides in sure eventualities, none of which apply within the Rodriguez or Hill circumstances and, in all of which, the U.S. lawyer normal would play a task in figuring out what must be accomplished with the forfeited digital belongings.
The Sovereign District of New York
When taking EO 14233 and the statutes cited on this article into consideration, the SDNY appears to have acted in a fashion that defies the EO 14233’s mandate to switch bitcoin obtained by way of legal forfeiture to the U.S. SBR.
This could not mark the primary time that the SDNY has acted in such a fashion.
The judicial jurisdiction, generally colloquially known as “Sovereign District of New York,” has earned a status for working independently and unilaterally, regardless of being a part of a federal system.
The truth that the SDNY proceeded with the circumstances in opposition to Rodriguez and Hill in addition to the case in opposition to Twister Money developer Roman Storm, is additional proof of this.
On April 7, 2025, Deputy Legal professional Normal Todd Blanche issued a memo entitled “Ending Regulation By Prosecution” through which he said “the Division [of Justice] will now not goal digital foreign money exchanges, mixing and tumbling providers, and offline wallets for the acts of their finish customers…”
The SDNY appeared to ignore the language on this memo, although, because it proceeded with the Samourai Pockets or Twister Money circumstances.
And when the protection staff for Hill and Rodrguez discovered as per a Brady request that two high-ranking members of the U.S. Division of the Treasury’s Monetary Crimes Enforcement Community (FinCEN) “strongly instructed” that Samourai Pockets wasn’t serving as a cash transmitter as a result of noncustodial nature of the service, the prosecution proceeded anyway.
In the case of legal circumstances tried inside the federal court docket system, over 90% of defendants are convicted and sentenced, with as little as 0.4% being acquitted some years. And the prosecution for SDNY circumstances has a status for having a good greater win charge.
Rodriguez was conscious of those statistics, in addition to the truth that Decide Denise Cote, the choose who presided over his and Hill’s circumstances, has a status for harsh sentencing.
He instructed me as a lot the morning earlier than he pleaded responsible to the conspiracy to function an unlicensed cash transmitter enterprise cost.
Is the Warfare on Crypto Actually Over?
Many Bitcoin and crypto proponents who voted for President Trump in 2024 in addition to the crypto business, which supported the president in his reelection, are actually starting to query whether or not or not President Trump actually does need to see an finish to the conflict on crypto.
For this to occur, the DOJ underneath President Trump should honor what is remitted in EO 14233 and observe Deputy Legal professional Normal Blanche’s steering to cease prosecuting builders of noncustodial crypto expertise.
To the latter level, President Trump not too long ago said that he’s contemplating a pardon for Rodriguez.
His pardoning Rodriguez as properly having the DOJ look into why it offered the bitcoin that the Samourai builders forfeited would ship a sign that the president is sort of severe about his pro-Bitcoin and pro-crypto stance.
