FBI to auction 30,000 Silk Road bitcoins

13 Jun 2014

The US Federal Bureau of Investigation (FBI) is to auction off 30,000 bitcoins with a value of about US$17.3m, which were seized from the online Silk Road.

Last year, the FBI took part in an operation to shut down what became known as the Silk Road, which existed on the deepest part of the web and where a person could buy or sell goods and services using bitcoin. Such goods and services would be illegal, and include drugs, guns and even the hiring of assassins.

Having been successful, the US government is now looking to auction off on 27 June the enormous horde of ‘dirty money’ it had seized from users. The US government also confirmed a further 144,341.53 bitcoins (€64.2m) will also be auctioned at a later date.

In October of last year, the FBI caught the Silk Road’s founder Ross Ulbricht, otherwise known as ‘Dread Pirate Roberts’ to users online, as he was working on his illegal project in a San Francisco, California, public library.

Undercover officers surrounded Ulbricht before eventually jumping on him and making the arrest before he could close his laptop and scramble the files within that could be used as evidence against him.

According to The Wall Street Journal, this massive sale of bitcoins could have a detrimental effect on the stability of the cryptocurrency, with its price down 7.15pc yesterday to US$583.04.

Bitcoin image via Shutterstock

Colm Gorey was a senior journalist with Silicon Republic