Mystery bidder plunders the whole haul in Silk Road Bitcoin auction
Feds keep mum on who and for how much – can YOU guess?
The US Marshals Service says the entire hoard of Bitcoins seized from shuttered online drugs souk Silk Road have gone to a single bidder in an auction held on Friday.
The 29,656.51306529 Bitcoins that prosecutors wrested from wallets belonging to Silk Road have an estimated real-world value of around $19m at today's exchange rates. We don't know whether the winner got a good deal on them, though, because the feds did not disclose the value of the winning bid.
They didn't say who placed the bid, either, although it might be possible to guess. In an embarrassing cock-up two weeks ago, the US Marshals managed to leak the entire list of potential bidders when it cc'ed them all in a mass email.
The list of suspects mostly included Wall Street types and representatives of various Bitcoin companies, and while none has yet confirmed that they were the winner, several have already stepped forward to say that they were outbid.
Among the firms who said they had not received any of the Bitcoins were the Bitcoin Shop, CoinApex, Coinbase, Pantera Bitcoin, and Rangeley Capital, according to a report by The New York Times.
Barry Silbert of SecondMarket, which had organized a syndicate of 42 bidders to participate in the auction, said his firm had also been outbid on every block of coins it went for.
The FBI seized the Bitcoin haul following the arrest of alleged Silk Road mastermind Ross Ulbricht in October. Although Ulbricht – who maintains his innocence – has yet to stand trial, the confiscated digital funds were auctioned off under federal forfeiture laws as "proceeds of a criminal enterprise."
What has not yet been auctioned, however, is a separate cache of more than 173,000 Bitcoins that are said to belong to Ulbricht himself. Ulbricht's lawyer has challenged the feds' authority to seize those assets, and a judge has stayed that civil forfeiture proceeding pending the outcome of his criminal trial.
Or make that trials. Ulbricht is due to answer drugs trafficking and money laundering charges in a New York court in November. Even if he makes it through that gauntlet, however, he will then be tried in Maryland on the much more serious charge that he tried to arrange the contract killings of six people over disputes related to Silk Road.
More than one of the charges against Ulbricht carry a maximum sentence of life imprisonment. ®