Computer Business Review

US government to auction off $17.4m worth of Bitcoin

by Michael Moore| 13 June 2014

Stash was seized from dark web site Silk Road last October.

US government marshals have announced they are to auction off a major haul of Bitcoin which had been stored on notorious 'dark web' site Silk Road.

Around 30,000 bitcoins, worth $17.4m, will go on sale on June 27, having been obtained in an FBI raid last October, consisting of nine blocks of 3,000 bitcoins and one block of 2,657 bitcoins.

Potential bidders have until noon EDT on June 23 to register for the auction, and must make a refundable deposit of $200,000 via wire transfer from a bank account based in the United States. Winning bidders will be notified on June 30, and should be able to process the payment by the end of the following day.

The bitcoins were held in several wallet files stored on Silk Road servers, and will be auctioned over a 12-hour period on the U.S. Marshals Service (USMS) website. The value of the cryptocurrency is now six times what it was when the haul was seized; meaning whoever wins the auction should be in for a major profit.

The USMS said it would not answer any questions regarding either the associated criminal or civil cases that resulted in the seizure of the bitcoins being auctioned, and would also not sell to any person who is acting on behalf of or in concert with Silk Road or its owner, Ross William Ulbricht, with bidders being required to do so in order to qualify for the auction.

In addition to the bitcoins going under the hammer, the FBI confirmed that an additional 144,342 bitcoins seized in the same raid had been transferred from the FBI e-wallet to the USMS e-wallet.

This amount forms part of the criminal action being brought against Ulbricht and the assets of Silk Road, the USMS said, as he is also being charged with narcotics trafficking, computer hacking and money laundering offenses in connection with his alleged operation of the site.

Reuters reported that Bitcoin prices fell about 6.74% to $585.56 following the news.

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