The Eleventh Circuit Court of Appeals said the FBI is not liable for wiping a seized hard drive that allegedly held 3,443 Bitcoin (BTC) worth about $345 million. The panel ruled that Michael Prime cannot sue the government because he did not timely tell officials he owned the Bitcoin. The judges stressed that his earlier filings minimized crypto holdings.
The appeals court noted that the FBI wiped the hard drive under standard evidence procedures. By the time Prime asked for the drive’s return after July 2022, the device was already destroyed. The panel wrote that granting relief “would be inequitable,” adding that “even if the bitcoin existed—and that’s a big if—awarding Prime an equitable remedy here would be inequitable.”
The ruling leaves the FBI without liability for the destroyed hard drive. The appeals court focused on records, dates, and statements. The judges said the timeline and disclosures did not support Prime’s later claim to thousands of Bitcoin.
Michael Prime, 3,443 BTC, and Ownership: What the Record Shows
Court records say Michael Prime initially claimed ownership of approximately 3,500 Bitcoin before a November 2019 plea deal for device fraud, identity theft, and unlawful firearm possession. After the plea, he changed his position and reported only small Bitcoin holdings. The appeals court weighed those shifts against his later demand for 3,443 BTC.
In February 2020, Prime’s financial disclosure to the government listed only $200 to $1,500 in bitcoin. He later told the probation office that Bitcoin was his only remaining asset. Those figures conflict with the later assertion of thousands of BTC on a wiped hard drive.
The opinion summarized the contradiction:
“For years, Prime denied that he had much bitcoin at all. And bitcoin was not on the list when he sought to recover missing assets after his release from prison. Only later did Prime claim to be a bitcoin tycoon.”
The appeals court called the delay unreasonable and a bar to suit. The FBI therefore bears no responsibility for the wiped hard drive.
Eleventh Circuit Opinion and Bitcoin Price: Quotes and Timeline
Prime tried to explain the February 2020 disclosure by saying he referred to the market value of one bitcoin—between $200 and $1,500. The Eleventh Circuit rejected that reading. The panel wrote, “We don’t buy it,” calling the valuation “preposterous” because Bitcoin traded above $10,000 at points in February 2020.
The appeals court emphasized that Prime sought the hard drive only after it was destroyed under FBI procedures. The judges tied the outcome to sworn filings, the Bitcoin price timeline, and ownership claims. They found no basis to award relief over the wiped hard drive.
By the time of the appeal, filings cited Bitcoin (BTC) near $103,105, framing the scale of 3,443 BTC at about $345 million. The court, however, kept its focus on records, not market swings. The FBI followed standard steps, and Prime’s earlier statements undercut the Bitcoin claim.
Lost Bitcoin, Private Keys, and Data: Glassnode and Chainalysis
The case underscores how Bitcoin custody depends on a private key. A private key is required to access BTC on any wallet or hard drive. If a key is lost or destroyed, the Bitcoin tied to that key becomes inaccessible.
On-chain data sources quantify the scale of lost Bitcoin. Glassnode estimates around 1.46 million BTC—nearly 7% of the 21 million supply—are likely lost. The figure reflects long-dormant coins and other signals. The lost Bitcoin estimate shows how missing private keys can permanently remove BTC from circulation.
Earlier, Chainalysis reported in 2018 that as many as 3.7 million BTC could be lost Bitcoin, or over 17.5% of supply. Methods and windows differ, so estimates vary. Yet each dataset points to a significant pool of BTC that will not move. In Prime’s dispute, the appeals court rested on disclosures, dates, and Bitcoin price context—not assumptions about lost Bitcoin or private keys.
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Tatevik Avetisyan is an editor at Kriptoworld who covers emerging crypto trends, blockchain innovation, and altcoin developments. She is passionate about breaking down complex stories for a global audience and making digital finance more accessible.
📅 Published: November 6, 2025 • 🕓 Last updated: November 6, 2025
