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The United States seized a record $ 1 billion in bitcoins a year ago. This is what they are worth now

2021-12-04T17:58:13.906Z

The price of the cryptocurrency has skyrocketed in the year since the US government seized thousands of bitcoins from the illegal Silk Road market.



By Ken Dilanian -

NBC News

The largest cryptocurrency seizure by the US Government has turned out to be a windfall for taxpayers.

These are thousands of bitcoins seized in November 2020 in connection with the illegal Silk Road marketplace, a dark web forum where drugs and other illicit products were bought and sold with the digital currency. 

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Bitcoins remain in the hands of the Government, for bureaucratic reasons.

And in the year since then, the price of bitcoin has tripled.

So what was once worth $ 1 billion is now worth about $ 3 billion. 

That's slightly less than when bitcoin was at its all-time high of $ 67,000 last month.

But with bitcoin hovering around $ 55,000 - up from $ 18,000 in November 2020 - Uncle Sam has done quite well.

The Government will auction the bitcoins, according to an Internal Revenue Service spokesperson to our sister network NBC News.

The proceeds from these auctions are typically deposited into the Treasury Forfeiture Fund or the Department of Justice Asset Forfeiture Fund, and are used to support future investigations.

A worker installs a new row of Bitcoin mining machines at a Whinstone US facility in Rockdale, Texas, on October 9, 2021.MARK FELIX / AFP / AFP via Getty Images

Most of the government's handling of cryptocurrency has been much less remunerative.

In fact, it is mostly a story of missed opportunities.

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The United States Marshals Service claims it has sold 187,381 bitcoins in nine auctions since 2014. A spokesperson declined to provide the amounts of money involved, but based on the price of bitcoin on the day of each sale, NBC News estimated that the total proceeds would have been. been about 179 million dollars.

At today's price, those coins would fetch more than $ 10 billion, nearly 56 times that.

In its first Silk Road-related seizure in 2014, the government seized 29,657 bitcoins and sold them for about $ 18 million.

Today they would be worth more than 1.6 billion dollars.

In those days, it was not easy to sell Bitcoin, a digital currency created with

blockchain

technology

(a public database where purchase and sale operations or any other type of transaction are recorded).

The Administration was concerned that there would be no buyers, said Sharon Cohen Levin, who led the Money Laundering and Asset Forfeiture Unit at the United States Attorney's Office for the Southern District of New York for two decades.

"It was insane of difficulty, in terms of figuring out how to do it," he said.

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In hindsight, simply storing the bitcoin would have garnered a fortune, but for better or worse, the government is not in the business of holding the cryptocurrency for investment purposes.

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Silk Road was an anonymous market for criminal activities.

Its founder, Ross Ulbricht, was sentenced to life in prison in 2015 after being convicted of money laundering and drug trafficking charges.

The $ 1 billion seizure last year came after the Internal Revenue Service (IRS) used

software

company

Chainalysis to identify 54 undetected bitcoin transactions executed by Silk Road. previously.

These funds were traced back to a bitcoin address, according to court records, owned by an unidentified person who had allegedly hacked into Silk Road and stolen the money.

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"According to that hacking investigation, law enforcement seized several thousand Bitcoins on November 3, 2020. On November 4, 2020, the seized Bitcoin was worth more than $ 1 billion," according to the complaint. .

And now, it is worth much more.

Source: telemundo

All news articles on 2021-12-04

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