$10m worth of illegal bitcoin to be auctioned by US marshals

Over 44,000 bitcoins seized by the US Marshals Service is set to be auctioned next month, with the cryptocurrency being detained as part of a nationwide crackdown on underground marketplace Silk Road.

 

Up for sale

The price of one bitcoin currently stands at $244.92, which means that the US Marshals service could pocket over $10.8m during its November 5th auction, with 44,341 bitcoins being sold.

This will be the fourth and final auction related to the seized property, which was gained by the Secret Service during a Silk Road crackdown operation in 2013.

The cryptocurrency belonged to Ross Ulbricht, (pictured below) founder of the illegal marketplace who was sentenced to life in prison in June after finally being arrested in October 2013. He was found guilty on the charges of conspiracy to commit drug trafficking, computer hacking and money laundering.

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Controversial cryptocurrency

Both the US Secret Service and bitcoin enthusiasts will be happy to see the back of the virtual contraband.

In September, Payment Eye brought to you the news that Shaun Bridges, a former US Secret Service agent who was put in charge of an investigation into Silk Road, pleaded guilty of stealing thousands of bitcoin.

It was revealed that once the Secret Service gained control of the marketplace, Bridges took over an administrator account on the site, and went on to steal around 20,000 bitcoin from numerous wallets totalling $820,000.

The scandal negatively affected bitcoin’s reputation. During the Silk Road scandal, you could have purchase one bitcoin for as little as $70.

 

Free-for-all

The previous three bitcoin auctions proved extremely popular with investors. During the first virtual currency sale in July 2014, venture capitalist Tim Draper purchased the entire 30,000 bitcoins that were up for purchase. A further 50,000 bitcoins were sold in March, many of which were purchased by New York bitcoin exchange SecondMarket.

According to the US Marshals office, November’s auction will take place during a six-hour period on November 5th from 8 a.m. to 2 p.m. EST.

Bids will be accepted by email from pre-registered bidders only. The bitcoins are being offered in 22 blocks: 21 blocks of 2,000 bitcoins and 1 block of just over 2,341 bitcoins. The winning bidder(s) will be notified the next day.

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