U.S. Government is Preparing to Sell 30,000 Bitcoins Seized From Silk Road

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by Polina Chernykh · 3 min read
U.S. Government is Preparing to Sell 30,000 Bitcoins Seized From Silk Road
The U.S. Marshals issued a press release, explaining that they are auctioning off the 30,000 bitcoins seized from the world’s biggest online drug bazaar Silk Road, but not the virtual coins seized from its founder Ross Ulbricht. Photo: Antana/Flickr

The U.S. Marshals Services announced on Thursday that it will auction nearly 30,000 bitcoins, estimated to be worth $18 million, which were seized in an operation from the online drugs marketplace Silk Road.

The government of the United States is going to auction about 30,000 bitcoins seized from the anonymous drug market called Silk Road. All the bitcoins are estimated at about $17,898,600 and are now held in the wallet, owned by the U.S. Federal Marshals, the agency tasked with selling off the assets.

The auction is scheduled for June 27th and will be held from 06:00 to 18:00 (EST).

The US Marshals Service divided the 30,000 bitcoins into nine blocks known as ‘Series A’ and 1 block ‘Series B’, which total 3,000 in the digital currency and 2,656.51306529 bitcoin, respectively.

In order to participate in the auction, the potential buyers must register with the US Marshals Service and provide the necessary documents by June 26th. The registration items include a $200,000 deposit, a copy of the photo ID and a signed PDF copy of the registration form.

The winner will become the person who offers the highest bid. The US Marshals Service (USMS) now the wallet includes 29,657 bitcoins.

The winners have to pay for their bitcoins by July 1st.

Notably, the recent bitcoin slump, when prices for the digital currency decreased under $600, was likely provoked by the Silk Road assets sale.

The US Marshals Service has the right to deny anybody from purchasing any block of the cryptocurrency and sell only a block of bitcoin.

The US federal government announement reads:

The US Marshals are preparing to auction nearly 30,000 bitcoins in connection with a civil forfeiture and criminal action brought against Ross Ulbricht and the assets of Silk Road in October 2013 in federal court in the Southern District of New York.

The auction will take place during a 12-hour period on June 27 from 6 a.m. until 6 p.m. Eastern Daylight Time. Bids will be accepted by email from registered bidders using a form available from the US Marshals Web page, www.usmarshals.gov/assets/2014/bitcoins.

In order to make a bid in this auction, potential bidders must register between the period of June 16 at 9 a.m. through June 23 at noon EDT and make a refundable deposit of $200,000 via wire transfer from a bank account in the United States. The bitcoins will be auctioned in nine blocks of 3,000 bitcoins and one block of approximately 2,657 bitcoins. The winning bidder(s) will be notified on June 30.

The bitcoins offered in this auction have been ordered forfeited to the United States. In a separate criminal case, Ulbricht has been charged with narcotics trafficking, computer hacking and money laundering offenses in connection with his alleged operation of “Silk Road,” a hidden Web site that was designed to enable its users to buy and sell illegal drugs over the Internet anonymously.

All the bitcoins that were held in an FBI wallet have been transferred to two US Marshals wallets. One wallet is being used for this auction, and the other wallet is being used to hold the remaining approximate 144,342 bitcoins that are part of the civil forfeiture and criminal action brought against Ross Ulbricht and the assets of Silk Road.

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