Key Takeaways
- The U.S. authorities has begun liquidating the bitcoin it seized from Silk Street exploiter James Zhong.
- The DOJ already bought 9,861 BTC on March 14, netting $215.5 million.
- It plans on promoting the remaining 41,490 BTC in 4 installments over the course of the yr.
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On-chain analysts observed originally of the month that the U.S. authorities was shifting funds it had seized from Silk Street exploiter James Zhong. It seems that the DOJ was maneuvering to promote a few of the stash.
Dumping Silk Street Bitcoin
The U.S. authorities is promoting a few of its bitcoin holdings.
A brand new submitting from america Division of Justice signifies that a few of the bitcoin seized by authorities from Silk Street exploiter James Zhong has already been bought.
In line with the doc, the federal government held at one level a complete of 51,351 BTC (price roughly $1.4 billion at immediately’s costs) in connection to Silk Street—the vast majority of which got here from Zhong. Of those holdings, 9,861 BTC had been bought on March 14, netting the DOJ over $215.5 million. The submitting states that the federal government paid roughly $215,738 in charges for the transaction. It plans to promote the remaining 41,490 BTC ($1.1 billion) in 4 extra installments over the course of the calendar yr—although it can wait till Zhong’s sentencing to liquidate the second batch.
Zhong is accused of defrauding darknet market Silk Street by exploiting the platform’s withdrawal mechanism in September 2012. U.S. authorities managed to grab Zhong’s stash of fifty,676 BTC in November 2021. Zhong pleaded responsible to at least one rely of wire fraud in November 2022. Although he faces as much as 20 years in jail, he just lately requested the courtroom to spare him jail time, on account of his troublesome childhood, autism, and the truth that his crime was victimless. He’s scheduled for sentencing on April 14.
It’s extremely seemingly that the federal government used Coinbase to promote its 9,861 BTC. On-chain analysts observed originally of March that wallets related to seized Silk Street funds had moved roughly 49,000 BTC to varied recent addresses. Certainly one of these addresses was recognized as belonging to crypto change Coinbase; it obtained 9,825 BTC on March 7.
The DOJ’s use of Coinbase is atypical, as the federal government has traditionally most popular liquidating seized digital property by way of public auctions.
Disclosure: On the time of writing, the writer of this piece owned BTC, ETH, and several other different crypto property.
