US Marshals auction off Silk Road Bitcoin
Posted by: Jon Ben-Mayor on 06/13/2014 07:23 AM
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In the market for some Bitcoin? The US Marshal Service has exactly what you need, but first you must register with them by providing all your particulars before you can become a registered bidder.
The Bitcoin being auctioned comes from Silk Road which was seized last October. In fact, the 29,656.5 coins up for sale are a small fraction of the total seized bitcoin hoard from the Silk Road case according to Wired. It also has another 144,342 coins whose fate is still in limbo. That larger fortune, currently worth over $83.6 million, was seized from Ross Ulbricht, the 30-year-old alleged to have run the Silk Road under the handle the Dread Pirate Roberts. In a court motion last December, Ulbricht confirmed that the coins were his but contested the government’s seizure of them, demanding their return.
The government’s bitcoin bake sale could potentially play havoc with the cryptocurrency’s economy. The current auction represents around only a quarter of a percent of the total number of bitcoins in circulation. But the still-contested 144,000 coins represent close to 1.1 percent. If that larger pot of coins is sold off in the same auction style, it could potentially flood the market with cheap coins and lower their price. In the hour following the Marshals’ news, the price of bitcoin fell about 2 percent.
One interesting question that Wired poses is - why are they selling them via auction rather than on the Bitcoin exchange? Of course when they asked the USMS public affairs office for clarification they received no response. I wonder if it has to do with the registration requirement, this way they know they will have solid and verifiable information which could lead further investigations perhaps? Maybe they are laying out a trap for others involved in the "conspiracy" seeing if they will attempt to recoup some of the Bitcoin which they lost when the site was seized.
The Bitcoin being auctioned comes from Silk Road which was seized last October. In fact, the 29,656.5 coins up for sale are a small fraction of the total seized bitcoin hoard from the Silk Road case according to Wired. It also has another 144,342 coins whose fate is still in limbo. That larger fortune, currently worth over $83.6 million, was seized from Ross Ulbricht, the 30-year-old alleged to have run the Silk Road under the handle the Dread Pirate Roberts. In a court motion last December, Ulbricht confirmed that the coins were his but contested the government’s seizure of them, demanding their return.The government’s bitcoin bake sale could potentially play havoc with the cryptocurrency’s economy. The current auction represents around only a quarter of a percent of the total number of bitcoins in circulation. But the still-contested 144,000 coins represent close to 1.1 percent. If that larger pot of coins is sold off in the same auction style, it could potentially flood the market with cheap coins and lower their price. In the hour following the Marshals’ news, the price of bitcoin fell about 2 percent.
One interesting question that Wired poses is - why are they selling them via auction rather than on the Bitcoin exchange? Of course when they asked the USMS public affairs office for clarification they received no response. I wonder if it has to do with the registration requirement, this way they know they will have solid and verifiable information which could lead further investigations perhaps? Maybe they are laying out a trap for others involved in the "conspiracy" seeing if they will attempt to recoup some of the Bitcoin which they lost when the site was seized.
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