FBI to auction $17.3 million in seized bitcoins
A stockpile of the virtual currency seized as part of a government crackdown on the Silk Road online marketplace last year will be sold on June 27.
By Michael Casey, The Wall Street Journal
The U.S. government on June 27 plans to auction almost 30,000 bitcoins, valued at $17.3 million, that were seized as part of the Federal Bureau of Investigation's crackdown last year on the Silk Road online marketplace for illicit drugs, the U.S. Marshals Service said Thursday.
In a statement, the Marshals Service confirmed it had taken custody of an additional 144,341.53 bitcoins that were seized as part of that operation. Those coins also are being readied for a separate sale, according to FBI spokeswoman Kelly Langmesser.
The Marshals Service said the first auction would take place over a 12-hour period on June 27 in nine blocks of 3,000 bitcoins and one of 2,657 coins. Interested buyers can place bids via a form at the U.S. Marshals website. The winners will be notified on June 30.
The liquidation of such a large amount of bitcoins could depress the price of the digital currency.
Bitcoin's price was down 7.15 percent Thursday to $583.04, according to the CoinDesk bitcoin price index, after having staged a two-month recovery from a recent low of $344.24 hit on April 11.Bitcoin's price reached an all-time high of $1,165.89 in December before regulatory actions in China and the U.S., coupled with the collapse of Tokyo-based bitcoin exchange Mt. Gox, sent the digital currency sharply lower in the first quarter of this year.
The FBI in October arrested Ross Ulbricht and charged him with being the owner and administrator of the Silk Road site under the pseudonym Dread Pirate Roberts.
Ulbricht, who has pleaded not guilty to those charges, has claimed ownership of around 29,000 seized coins. His lawyer, Joshua Dratel, on Thursday said he would continue to push for the return of those coins but didn't object to the sale, which was authorized by a New York judge under a forfeiture ruling earlier this year.
"Anything that would maximize or at least keep the property value [of the seized coins] is useful to us down the road," Dratel said.
A trial date of Nov. 2 has been set.
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