Correlation is not causation.
To be honest it's a bit hard to believe this reporting has nothing to do with the price dropping ~10%, given that one of BitCoin's big parts of its value prop is precisely supposed to be that governments can't do this.
In the case of coins moving through exchanges, they can simply take the coins instead by threatening the exchange.
In many other cases they can also catch you when you try to use the money by converting it into a currency that people actually use to transact like USD.
Do not mistake theory with reality.
10% daily moves happened four times in May: twice in each direction.
Statistically, we should consider it just a normal, unremarkable day for Bitcoin.
Perhaps people are correctly estimating that as BTC is likely to lose another use case for it (ransomware)[2], there is now less demand for it, thus resulting in the downward price pressure we've seen over the past few weeks.
Perhaps criminals are correctly predicting that 'their' BTC might be taken away from them, thus causing them to liquidate their positions, thus resulting in downward price pressure. [3]
[1] I am, of course, making a joke.
[2] The writing is on the wall, due to the government reaction to the Colonial hack.
[3] No, Monero is not a solution for them, because the FBI is not stupid. XMR:BTC is largely sideways. If ransomware switches to it, it's likely that exchanges transacting in privatecoins will be treated as international money launderers. https://coincodex.com/convert/monero/bitcoin/?amount=1
I wonder if the future push towards Proof-of-Stake away from Proof-of-Work will one day stop this happening.
This jeopardizes the use of Bitcoin as a currency for cross-border criminal transactions which is a large if not majority share of its use case.
So it’s easy to see why its value went down — fewer criminals will want to use it.
Do criminals seriously expect that bitcoin (or any other cryptocurrency) is safe against the wallet being hacked? Hardware/cold wallets have been around for years, so this is more of an opsec issue than a technology issue.
But what does crypto have to do with criminals? Criminals just need to up their op sec game, they know that. BTC dropping is only related insofar as this stupid correlation is getting pushed hard in the media right now.
Criminals are basically the only group making widespread use of Bitcoin as a currency rather than as an asset class.