U.S. Gov. to Sell 29,655 Bitcoins Seized in Silk Road Case

U.S. Gov. to Sell 29,655 Bitcoins Seized in Silk Road Case The shut down by U.S. authorities last year of the Silk Road “hidden website’ has yielded the largest forfeiture of bitcoins, with the Manhattan U.S. Attorney announcing Thursday that $24 million worth (Friday’s estimated value at about $800 each) of the virtual currency will be sold.
The bitcoins will be auctioned off, although there is no announcement yet as to the details of the sale.
Whenever it happens, the event will mark the first ever auction of bitcoins by the U.S. government.
Moreover, U.S. officials says they have another 144,336 bitcoins (worth about $115 million at Friday’s value) seized from computers belonging to Ross Ulbricht, the alleged Silk Road founder.
But Ulbricht has filed a claim in the civil forfeiture action, asserting that he is the owner of the bitcoins found on his computer hardware, and contesting the forfeiture of those bitcoins.
The Silk Road website and the bitcoins that were forfeited Thursday had been seized with a civil action filed in Manhattan federal court on September 30, 2013.
“These Bitcoins were forfeited not because they are Bitcoins, but because they were, as the court found, the proceeds of crimes,” said Manhattan U.S. Attorney Preet Bharara.
That action sought all assets of Silk Road, including its website and all of its bitcoins because those assets allegedly were used to facilitate money laundering.
The Silk Road site was designed to enable its users to buy and sell illegal drugs and other unlawful goods and services anonymously, said a statement from the United States Attorney for the Southern District of New York.
In addition to the civil action, Ulbricht, also known as “Dread Pirate Roberts,” the alleged owner and operator of Silk Road, was charged in September 2013 in Manhattan federal court with narcotics conspiracy,conspiracy to commit computer hacking, and money laundering conspiracy.

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