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US Government Moves $2B Of Silk Road’s Bitcoin To Coinbase

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Key Takeaways

  • The US Department of Justice (DOJ) initiated a transfer of over 30,000 BTC associated with the Silk Road case to a Coinbase wallet.
  • The US government has previously used Coinbase to sell confiscated Bitcoins, with a significant sale in 2023 amounting to approximately $215 million.

The US Department of Justice (DOJ) reportedly tried to move some Bitcoin from a wallet containing $2 billion in seized cryptocurrency linked to Silk Road to Coinbase Prime. The first transfer was a small amount, likely just a test transfer of 0.001 BTC.

US Government Transfer $130M Worth Of BTC After Test Transfer

After the small test transfer, roughly 2000 BTC (worth about $131.27 million) was sent to the Coinbase Prime hot wallet on April 2nd, 4:59 UTC.

The US government initially aimed to transfer all 30,175 Bitcoin seized from Silk Road to Coinbase, but only a small portion has moved so far. The majority of the Bitcoin remains unspent at this address:

“Bc1qjet9suh6lpyu8uwcseywkr9zcn55lawp83wzde”

This is not the first time the US has used Coinbase to move the seized Bitcoin. In March 2023, authorities transferred a large amount of Bitcoin, including some sent directly to a Coinbase wallet.

Seized Bitcoins Tied To Silk Road

The large amount of Bitcoin is likely connected to the US government’s seizure of assets from Silk Road, the now-closed dark web marketplace. This follows a US appeals court decision last year that mandated the forfeiture of 69,370 Bitcoins (along with other cryptocurrencies) linked to the darknet market.

In October 2013, the FBI shut down the website as it was facilitating illegal drug sales. The takedown included arresting its founder, Ross Ulbricht, and confiscating a significant amount of Bitcoin used on the platform. Ulbricht was subsequently convicted of money laundering, computer hacking, and drug trafficking charges in February 2015, and is currently serving a double life sentence with no chance of parole.

In 2020, the DOJ set its sights on over $1 billion worth of cryptocurrency tied to the marketplace and began legal proceedings to seize it. These recent transactions likely originate from a wallet belonging to James Zhong. Convicted in 2022 for illegally obtaining more than 50,000 BTC from Silk Road, Zhong’s home raid in 2021 by US authorities yielded hardware wallets filled with Bitcoin.

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